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New for 2026
Trump accounts open, the 1099-K threshold goes back up, and other changes that started in 2026
A dozen smaller changes took effect with the 2026 tax year. Most touch one kind of household: parents of young children, people paid through apps, teachers, gamblers, anyone with a 529 plan. Find yours.
By Charles Trautman, EA
The Tax Shop · Lone Tree, Colorado · Reviewed October 14, 2026
The 2025 tax law changed more for 2026 than any year since 2018. The big items, the brackets, the charitable deduction, the Marketplace credit, the four deductions through 2028, each have their own article. This one collects the rest: a dozen smaller changes that each matter a great deal to the household they touch and not at all to anyone else.
Trump account contributions opened July 4, 2026
Family members and others can put up to $5,000 a year into a Trump account for a child under 18, and an employer can contribute up to $2,500 of that tax-free. Children born 2025 through 2028 can get a one-time $1,000 deposit from the federal government, but only if a parent elects it on Form 4547. The election is not automatic, and a child born in 2025 whose parents have already filed can still make it. The accounts, the deposit and how they compare with a 529 are covered in The child tax credit and Trump accounts.
Fewer forms, same income
Form 1099-K is back to the old threshold. Venmo, PayPal, eBay, Etsy and similar platforms send one only when you receive more than $20,000 and more than 200 payments in a year. The planned $600 threshold never took effect and is now repealed.
Fewer 1099s from businesses. For payments made in 2026, a business sends Form 1099-NEC or 1099-MISC only when it pays you $2,000 or more, up from $600; the figure is indexed from 2027. If you are a contractor, expect fewer forms in January and keep your own records; the income is taxable whether a form arrives or not. If you pay contractors, the $2,000 line applies to the forms you send in January 2027.
Worked example: a handyman with six customers
| Customer | Paid in 2026 | 1099-NEC in January 2027? |
|---|---|---|
| Property manager A | $9,400 | Yes |
| Property manager B | $2,000 | Yes, exactly at the line |
| Small restaurant | $1,850 | No (would have been yes last year) |
| Dental office | $1,200 | No |
| Two homeowners | $3,100 | No; individuals don’t issue 1099s for personal work |
| Reportable income | $17,550 | Forms received: $11,400 |
A return that reports $11,400 because that is what the forms say is $6,150 short. The IRS may not catch it in year one, but a bank-deposit analysis in an audit will, with interest running from April 2027.
The rest of the list
Mileage went up in July. The business rate was 72.5 cents a mile for January through June and 76 cents from July 1. Medical and military moving miles went from 20.5 to 23.5 cents; charity miles stay at 14 cents. A dated log now matters twice: once to prove the miles, once to price them. Ten thousand business miles spread evenly over the year are worth $7,425, not $7,250 or $7,600.
Gambling losses: only 90% deductible. Losses are still limited to winnings, and now only 90% of them count. Win $50,000 and lose $50,000, and $5,000 is taxable even though you broke even. A bill to undo this is pending; until it passes, the rule stands. Sports bettors with a season of W-2Gs are the ones who feel it.
529 plans and K–12 tuition. A 529 can now pay up to $20,000 a year of K–12 tuition per student, up from $10,000, and the list of covered school expenses is longer: books, tutoring, testing fees, and some therapies for students with disabilities. College expenses are unchanged. If your state gives a deduction for 529 contributions, it applies to the contribution either way.
A bigger child care credit. As much as 50% of up to $3,000 of costs for one child or $6,000 for two or more, stepping down with income to 35% and then 20%. The dependent care FSA rises to $7,500 a year per household, from $5,000, which for a two-earner family in the 22% bracket is worth about $550 more in tax savings, plus the payroll tax saved on the extra $2,500.
Mortgage insurance is deductible again for itemizers, and the $750,000 mortgage interest limit is permanent. Home equity interest still is not deductible unless the loan built or improved the home.
Teachers and coaches who itemize can deduct all their unreimbursed classroom costs. The $300 deduction without itemizing stays.
State-declared disasters now count for personal casualty losses, not just federally declared ones. That means a tornado, flood or other disaster your governor declares, without waiting for FEMA.
Employer student loan help, up to $5,250 a year tax-free, is permanent and rises with inflation after 2026. Loans forgiven on death or disability stay tax-free permanently.
Gone for good: moving expenses (except military and some intelligence staff) and the old 2%-of-income itemized deductions such as unreimbursed job expenses, union dues and investment fees. Bicycle commuting reimbursements stay taxable.
ABLE accounts keep their higher contribution limits, and 529-to-ABLE rollovers are permanent.
| If you are… | Look at |
|---|---|
| A parent of a child born 2025–2028 | Form 4547 for the $1,000 deposit |
| Paid through apps or as a contractor | 1099-K and 1099-NEC thresholds; keep your own records |
| Self-employed and driving | Two mileage rates in one year; a dated log |
| A gambler or sports bettor | Only 90% of losses count |
| Paying private school tuition | 529 can pay $20,000 a year of K–12 |
| Paying for child care | Bigger credit; FSA to $7,500 |
| A homeowner paying PMI | Mortgage insurance deductible if you itemize |
| A teacher or coach | All classroom costs if you itemize |
| Hit by a state-declared disaster | Casualty loss now allowed |
Behind the scenes
The higher 1099 thresholds mean a self-employed client may arrive with half the forms they had last year and the same income. A preparer compares this year’s gross receipts with last year’s and asks about the gap before asking anything else. The IRS still matches every form it does receive, and a return that reports only the income that came with a form is the one that draws a letter two years later, when the interest has been running the whole time.
The Delaware side
Most of these never reach the Delaware return, because Form PIT-RES starts from federal AGI and the deductions above, mileage aside, are taken below that line; the Division of Revenue has said so for tips, overtime and car-loan interest. Two have a Delaware angle: the mortgage insurance, teacher and casualty changes do reach Delaware itemizers on Form PIT-RSA, which follows federal Schedule A, and the 529 change pairs with the small DE529 subtraction, $1,000 single or $2,000 joint, available under $100,000 / $200,000 of AGI.
The bigger federal child care credit raises Delaware’s too, since Delaware’s is 50% of the federal one. Delaware has no energy credits comparable to the federal ones that ended. The Delaware change that does bite in 2026 is HB 255: 100% bonus depreciation is gone for individuals and pass-throughs, replaced by 20% for 2026.
What to bring your preparer
- For contractors and app sellers: your own record of gross receipts for the year, not just the 1099s that arrived
- A mileage log with dates, so miles can be split at June 30
- W-2Gs and a gambling log or casino win/loss statement
- 529 withdrawals (Form 1099-Q) and the K–12 tuition bills they paid
- Child care provider’s name, address and tax ID, and your FSA contribution from the W-2
- Form 1098 showing mortgage insurance premiums, if you itemize
- For a child born 2025 or later: the child’s SSN, for Form 4547
Questions people ask
I didn’t get a 1099-K from PayPal this year. Does that mean the income isn’t taxable?
No. The threshold decides whether a form is sent, not whether income is taxable. Business income is reportable from the first dollar; personal reimbursements from friends were never taxable with or without a form.
I use one mileage figure for the whole year. Can I still do that?
Only if your miles were spread evenly, and then the blended rate is 74.25 cents. If your log shows the split, use the actual split; it is usually worth more to someone who drove more in the second half.
Can my 529 pay for my child’s private high school?
Yes, up to $20,000 per student per year for tuition, plus the newly covered expenses. Withdrawals beyond that for K–12 are taxable with a penalty on the earnings.
I won $8,000 and lost $9,000 at sports betting. What is taxable?
$800. Losses are capped at winnings ($8,000) and only 90% of that counts ($7,200), so $800 of the winnings is taxed, and only if you itemize. If you take the standard deduction, all $8,000 is taxed and the losses do nothing.
Fewer forms does not mean less income
The two threshold changes mean many people will get fewer 1099s in January than last year. The income is taxable either way, and the IRS still matches every form it does receive.
Written by Charles Trautman, EA, editor · Need to Know Tax, Lone Tree, Colorado
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