Common Tax Credits A tax credit is a dollar-for-dollar reduction in your amount of tax. There are two types of credits, refundable and nonrefundable. Refundable credits are allowed even if the amount of credit is more than your tax. For example, if your tax is $100 and you have a $150 credit, you will get a refund of $50. Common refundable credits are the Earned Income Credit, American Opportunity Credit and a portion of the Child Tax Credit. Refundable credits are often scrutinized more by the IRS, and my office can be fined if we help you file a credit for which you are not eligible.

The Senior & Standard Deductions Taxpayers over 65 will receive a deduction of $6,000 in addition to the standard deduction (and the additional standard deduction for those over 65). There is a phaseout for this deduction beginning at $75,000 ($150,000 MFJ). This is the only new deduction that married separate filers can still use. The standard deductions for 2025 are:Single/Married Separate: $15,750Head of Household: $23,265Married Joint: $31,500Joint filers over 65 receive an additional $1,600; Single and Heads of House over 65 an additional $2,000 Deductions include out-of-pocket medical expenses (above 7.5% of income), State and Local Taxes, Mortgage Interest, and Charitable donations.

QUALIFIED TIPS: what to know New tax law allows a deduction for qualified tips – up to $25,000 per return (not person!). A tip is a qualified tip if:It is paid in cash or cash equivalent.From a deduction-eligible occupation, as listed in proposed Treasury RegulationsIt is voluntarily paid by the customer and not subject to negotiation. What does not qualify?Service charges, like those typically added to large groups, do not qualify for the deduction, as they are not voluntary or negotiable.Tips earned for any illegal activity – for example, if you earn tips in a business that requires a license (like a liquor license, or cosmetology

2025 Tax Changes Update H.R. 1 was signed into law on July 4, and with it comes some changes that will affect the 2025 tax year. Here are some of the things you need to know: What happens next? When legislation is passed and entered into the US Code, the regulatory body (in this case, the Treasury Department/IRS) must process the law and create regulations to give guidance on how to comply. As the IRS does this, there may be more details released, and they’ll be passed along. Please know while this is a general guide, some things may be tweaked or