Merge pull request #866 from MicrosoftDocs/main

Auto Publish – main to live - 2026-01-26 13:00 UTC

Author: learn-build-service-prod[bot]

dynamics-gp/payroll/US19JanTaxR1.md

@@ -6,7 +6,7 @@ author: theley502
 ms.topic: article
 ms.reviewer: jswymer
 ms.author: theley
-ms.date: 1/16/2026
+ms.date: 1/20/2026
 ---
 # U.S. 2026 Payroll Tax Update
 
@@ -28,7 +28,7 @@ Check out these blogs for documentation on how you calculate payroll taxes in Mi
 
 [Tips to install the U.S. Payroll Tax Update](https://community.dynamics.com/blogs/post/?postid=dbc1295b-297f-4441-aa2f-7c2502bffc97)
 
-## Changes in January Round 1 update 
+## Changes in January Round 2 update (Released 1/22/2026)
 
 - Arkansas
 - Illinois
@@ -57,8 +57,8 @@ Tax Type rates for Filing Status NA:
 
 | If Over | But Not Over  | Tax Amount  | Tax Rate| On Excess Over|
 |-------------|------------------|----------------|--------------|--------------------|
-| 0           | 5,499            | 0              | 0.0%         | 0                  |
-| 5,499       | 11,199           | -111.98        | 2.0%         | 0                  |
+| 0           | 5,599            | 0              | 0.0%         | 0                  |
+| 5,599       | 11,199           | -111.98        | 2.0%         | 0                  |
 | 11,199      | 15,999           | -223.97        | 3.0%         | 0                  |
 | 15,999      | 26,399           | -287.97        | 3.4%         | 0                  |
 | 26,399      | 94,700           | -419.96        | 3.9%         | 0                  |
@@ -297,16 +297,16 @@ Withholding rates for taxpayers filing as *MAR*:
 | 0           | 11,775           | 0              | 0%           | 0                  |
 | 11,775      | 96,475           | 0              | 3.35%        | 11,775             |
 | 96,475      | 216,525          | 2,837.45       | 6.60%        | 96,475             |
-| 216,525     | 323,875          | 10,760.75      | 7.60%        | 216,525            |
-| 323,875     | And Over         | 18,915.55      | 8.75%        | 323,875            |
+| 216,525     | 323,825          | 10,760.75      | 7.60%        | 216,525            |
+| 323,825     | And Over         | 18,915.55      | 8.75%        | 323,825            |
 
 Withholding rates for taxpayers filing as *SINGLE*:
 
 | If Over  | But Not Over  | Tax Amount| Tax Rate | On Excess Over  |
 |-------------|------------------|----------------|--------------|--------------------|
 | 0           | 3,925            | 0              | 0%           | 0                  |
 | 3,925       | 54,675           | 0              | 3.35%        | 3,925              |
-| 54,675      | 126,775          | 1,770.13       | 6.60%        | 54,675             |
+| 54,675      | 126,775          | 1,700.13       | 6.60%        | 54,675             |
 | 126,775     | 260,225          | 6,458.73       | 7.60%        | 126,775            |
 | 260,225     | And Over         | 16,600.93      | 8.75%        | 260,225            |