Recent Tax Changes: The One Big Beautiful Bill

For Individuals & Families

• Bigger standard deduction. $15,750 single / $31,500 married filing jointly / $23,625 head of household for 2025. For 2026: $16,100 / $32,200 / $24,150.
• New senior deduction (2025–2028). An extra $6,000 for each taxpayer age 65 or older, on top of the standard deduction. It phases out above $75,000 of income ($150,000 joint).
• “No tax on tips” (2025–2028). Deduct up to $25,000 of qualified tips if you work in an eligible tipped occupation. Phases out above $150,000 ($300,000 joint).
• “No tax on overtime” (2025–2028). Deduct the extra “half” of federally required time-and-a-half overtime, up to $12,500 ($25,000 joint). Phases out above $150,000 ($300,000 joint).
• Car loan interest deduction (2025–2028). Deduct up to $10,000 a year of interest on a loan taken out after 2024 to buy a new, U.S.-assembled personal vehicle. Leases don’t qualify, and you’ll need the VIN. Phases out above $100,000 ($200,000 joint).
• Child Tax Credit. $2,200 per child (up to $1,700 refundable). The child needs a valid Social Security number.
• State & local tax (SALT) cap raised. $40,000 for 2025 ($40,400 for 2026) for itemizers, reduced for incomes over $500,000.
• Charitable gifts without itemizing (starting 2026). Deduct up to $1,000 ($2,000 joint) of cash gifts to qualifying charities even if you take the standard deduction.
• “Trump Accounts” for kids. A one-time $1,000 federal deposit for U.S.-citizen children born 2025–2028. Parents elect it on IRS Form 4547.
• Family accounts. Dependent care FSA limit rises to $7,500 in 2026, and 529 plans can cover up to $20,000 a year of K–12 costs starting in 2026.
• Energy credits ended. Electric vehicle credits ended September 30, 2025, and home energy credits (windows, heat pumps, solar) ended December 31, 2025.

For Small Businesses & the Self-Employed

• 20% qualified business income (QBI) deduction is now permanent.
• 100% bonus depreciation is back for property acquired after January 19, 2025, and the Section 179 limit rises to $2.5 million ($2.56 million for 2026).
• Form 1099-K threshold returns to more than $20,000 and 200 transactions.
• Forms 1099-NEC / 1099-MISC threshold rises from $600 to $2,000 for payments made in 2026 and later.

What to Bring to Your Tax Appointment

• All W-2s and 1099s. Tips and overtime may be shown in boxes 12 or 14, or on a separate statement from your employer.
• Final pay stubs showing overtime hours and pay, if you worked overtime.
• Your car loan interest statement and the vehicle’s VIN, if you bought a new vehicle in 2025.
• Social Security numbers for everyone on your return.
• Receipts for charitable gifts and property tax / state tax paid.

Not sure which changes apply to you?

We’ll walk through it with you. Call 614-445-0610 or book online.