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Itemized Deduction 2/37 Limitation Calculator (2026, Section 68)

What do these figures come to once the work is shown?

Reduction of itemized deductions for taxpayers in the 37% bracket under the 2026 rule.

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  • Nothing stored or sent
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Your figures
Example figuresIllustrative only. Type over them with your own.
Reduction in itemized deductions
$6,486
Section 68 for tax years after 2025
Itemized deductions allowed
$113,514
Income above the 37% bracket start
$251,300
Taxable income + itemized deductions - bracket start
Drawn to one scale
Reduction in itemized deductions$6,486
Itemized deductions allowed$113,514
Income above the 37% bracket start$251,300
37% bracket start used$768,700
All results
MeasureResult
Reduction in itemized deductions$6,486
Itemized deductions allowed$113,514
Income above the 37% bracket start
Taxable income + itemized deductions - bracket start
$251,300
37% bracket start used$768,700
How this was worked out
Work shownrecomputed as you type
Excess = (taxable income before the limit + itemized deductions) - start of the 37% bracket
Reduction = 2/37 x lesser of itemized deductions or excess
2026 starts: $640,600 single and head of household, $768,700 joint, $384,350 separate

Illustrative arithmetic on the figures you enter. Check the result against your firm's methodology before relying on it.

The formulas

  • Excess = (taxable income before the limit + itemized deductions) - start of the 37% bracket
  • Reduction = 2/37 x lesser of itemized deductions or excess
  • 2026 starts: $640,600 single and head of household, $768,700 joint, $384,350 separate

How it works

Section 68 as rewritten by the One Big Beautiful Bill Act reduces itemized deductions by 2/37 of the lesser of the deductions or the amount by which taxable income, before the limit and increased by itemized deductions, exceeds the start of the 37% bracket. It applies to tax years beginning after December 31, 2025, after every other limit on itemized deductions.

Publication 505 for 2026 describes the same cut as 5.4% and lists the bracket starts from Rev. Proc. 2025-32. The effect is to cap the value of each itemized dollar at 35 cents for taxpayers in the top bracket.

Illustrative figures only. Check the result against your firm's methodology before relying on it.

Common questions

Does it affect the QBI deduction?

Publication 505 states the limitation does not apply when figuring the QBI deduction.

Is it the old Pease limit?

No. Pease used 3% of AGI over a threshold. This rule uses 2/37 tied to the 37% bracket.

What if I take the standard deduction?

The rule applies only to itemized deductions.

Sources

Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.

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