The US tax code always seems to be in flux. It’s been compared to a hedge—the more aggressively you prune it, the more furiously it grows back.
The first federal income tax in the US was imposed to pay for the cost of the Civil War. It wasn’t until 1913 that the federal income tax became a permanent fixture in American life. In the century-plus since then, the tax code has often changed in reaction to upheavals, especially wars and economic hardships.
If the Tax Cuts and Jobs Act of 2017 is not extended, the top federal income tax bracket is set to rise to 39.6% in 2026. The threshold for income that would be taxed at that rate for individuals would fall to $470,000, from about $610,000 currently, as adjusted for inflation.
The top tax rate hasn’t been higher than 39.6% since 1986, but this is far from the highest it has been. Here’s a look at how the top tax rate has changed over the years and what has driven it.
(If history isn’t your jam, you can check out how tax brackets work, or find today’s federal income tax brackets.)
The top income tax rate isn’t the only thing that will change if Congress doesn’t extend the Tax Cuts and Jobs act next year. Here’s a look at the major provisions that could change in 2026: