Significant New Tax Law Changes for 2025 Tax Returns Overtime: The Act adds a new deduction of up to $12,500 ($25,000 for joint filers) for “qualified overtime compensation,” subject to phaseout for a taxpayer with Modified Adjusted Gross Income exceeding $150,000 ($300,000 for joint filers). The employee must be considered non-exempt under the Fair Labor…
Items Affecting 2025, 2026 or Future Years’ Individual Tax Returns ABLE accounts: The Act permanently provides for additional contributions to Achieving a Better Life Experience (ABLE) accounts for employed individuals with disabilities. The Act also permanently allows beneficiaries who make qualified contributions to their ABLE account to qualify for the Saver’s Credit. Adoption: Starting in…
Items Affecting 2025, 2026 or Future Years’ Business Tax Returns (including 1040s with Schedules C or E) Bonus depreciation: The Act makes additional first-year (bonus) deprecation for certain qualified property acquired after January 19, 2025, permanent at 100%. There is also a new 100% bonus depreciation provision for “qualified production property” (QPP) which is certain…
No Tax on Overtime: A New Federal Deduction for Workers The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduced a significant new tax benefit for millions of American workers: a federal income tax deduction for qualifying overtime pay. This provision will be effective for the years 2025 through 2028….
The One Big Beautiful Bill Act (OBBB) brings major updates to energy and clean vehicle tax credits, making 2025 a critical year for homeowners and car buyers looking to maximize savings. Energy Credits If you’re considering making energy-efficient or clean energy improvements to your home, now is a great time to act, as two valuable…
Opportunity zones are economically distressed communities that have been designated by states and certified by the U.S. Treasury, where new investments may be eligible for preferential tax treatment. The purpose of opportunity zones is to spur economic development and job creation in these areas by providing tax incentives for investors. When taxpayers invest eligible capital…
The One Big Beautiful Bill Act (OBBBA), passed in 2025, permanently extended the lower tax rates and higher standard deductions originally introduced under the Tax Cuts and Jobs Act (TCJA). Without OBBBA, these provisions were set to expire at the end of 2025, reverting to higher pre-2018 tax brackets. Tax Rate Single Filers Married Filing…
Charitable Contribution deductions for non-itemizers The 2025 Tax Act introduces a permanent charitable deduction for non-itemizers, allowing individuals who do not itemize deductions to claim a deduction of up to $1,000 ($2,000 for joint filers) for cash contributions made directly to public charities. This new provision, effective in 2026, enables taxpayers to benefit from a…
No Tax on Tips Starting in 2025, the One Big, Beautiful Bill (OBBB) introduces a federal income tax deduction for tips, allowing eligible workers to deduct up to $25,000 in reported tip income annually. To qualify, you must work in an occupation the IRS designates as “customarily receiving tips” and report those tips on a…
