As 2026 approaches many locals are paying attention to the new tax codes and the extra funds they could attain. The Gulf Shores and Orange Beach community has a high percentage of service workers and retirees, both of whom will have higher deduction rates in the next year.

The majority of these deductions are due to the passage of "The Big Beautiful Bill" in 2025, and the scheduled changes are expected to have immediate impacts on several demographic groups in the area. Below are a few of the initiatives which could help grow personal revenue for locals.

The standard deduction:

The bill increased the standard deduction for a single filer to $15,750, up from $15,000, and for a married couple to $31,500, up from $30,000.

No tax on tips or overtime:

Effective for 2025 through 2028, employees and self-employed individuals may deduct qualified tips received in occupations that are listed by the IRS as customarily and regularly receiving tips on or before December 31, 2024, and that are reported on a Form W-2, Form 1099, or other specified statement furnished to the individual or reported directly by the individual on Form 4137.



• “Qualified tips” are voluntary cash or charged tips received from customers or through tip sharing.

There is an official list of occupations which are covered in this deduction which can be reviewed HERE.

Senior bonus deduction:

A tax revision for seniors adds an additional $6,000 standard deduction bonus for taxpayers over age 65, many of whom are retired. The Council of Economic Advisers estimated that 88% of all seniors who receive Social Security – will pay no tax on those benefits.

Auto loan interest deduction:

The new deduction also allows eligible taxpayers to deduct up to $10,000 in auto loan interest on new qualifying vehicles. This temporary provision applies to vehicles purchased between January 1, 2025, and December 31, 2028. 

Child tax credits:

The child tax credit has been permanently raised to $2,200 per child, up from $2,000. Parents will also be able to open tax-advantaged investment accounts known as “Trump Accounts” for kids under 18 with Social Security numbers.

Charitable contributions:

Taxpayers will have a $2,000, "above the line" charitable contribution deduction, meaning you can deduct $2,000 if you don’t itemize your taxes.

The team at Gulf Shores News suggest you engage a tax professional for advice or more knowledge on these deductions. You can also read the provisions on the IRS official website.