2025-2026 Tax Law Updates

Wow, Less Taxes!

For 2025:

Single: $15,750

Married Filing Jointly: $31,500

Head of Household: $23,625

Temporary Deductions (2025–2028)

✅ No Tax on Tips

Up to $25,000 of tips can be deducted.

✅ No Tax on Overtime

Up to $25,000 of overtime pay can be deducted.

*Most employers will not separate your tips or overtime on your W-2. That responsibility falls on YOU, unless you file with us.

✅ Car Loan Interest Deduction

Interest on new U.S.-assembled cars purchased after 12/31/24 may be deductible (up to $10,000).

These three deductions are huge for working individuals.

If you itemize, you can now deduct more state income taxes + property taxes.

• 2025 SALT cap: $40,000

• Slowly increases until 2028, then drops back to $10,000 starting 2029

• High-income taxpayers over $500,000 AGI may see the extra deduction reduced, but it never goes below $10,000.

• Now $2,200 per child

• Up to $1,700 refundable

• Must have at least $2,500 of earned income

This is one of the most valuable family credits.

• Credit increased to $17,280 in 2025, with up to $5,000 refundable (previously $0).

If you want the EV credit, you must have purchased a qualifying vehicle before September 30, 2025.

• New EV credit: up to $7,500

• Used EV credit: up to $4,000

• If you owe taxes or file/pay late, the IRS now charges 7% interest.

This makes filing and paying on time more important.