Category Taxes & Tools

IRS 2025 Tax Updates: Bigger Deductions, Lower Taxes, Inflation Relief!

For the 2025 tax year, the IRS has introduced important updates aiming to ease the financial strain caused by rising inflation. One major change is the increase in the standard deduction, now $15,000 for singles (up from $14,600) and $30,000 for married couples filing jointly (up from $29,200). This lets taxpayers keep more of their earnings tax-free. Additionally, the IRS has raised the income limits in each tax bracket. Although the actual tax rates stay the same, the increased income brackets mean many people will pay less in taxes because more of their income is being taxed at lower rates. These adjustments are designed to help middle-income families and individuals manage expenses amid higher living costs.

2025 Budget Bill: Key Tax Changes Businesses Can’t Afford to Ignore

The 2025 Budget Bill, recently approved by the House and waiting for Senate review, contains important changes to business taxes that could affect many companies across the country. Among these proposed changes are adjustments to bonus depreciation rules, updates to research and development deductions, and modifications to the Qualified Business Income (QBI) deduction. These new proposals are intended to encourage business growth and streamline tax rules. However, businesses may need to rethink their financial strategies to prepare for these possible changes. This legislation is being closely watched by investors and businesses, especially given recent improvements in the stock market and ongoing negotiations around trade deals.

SALT Cap Hike: Relief for Families or Risk to Public Funds?

The House-approved federal tax plan proposes several significant changes, most notably raising the cap on the state and local tax (SALT) deduction from $10,000 to $40,000 starting in 2026. This increase specifically targets households earning less than $500,000, gradually decreasing for those earning above that threshold. Supporters argue that this measure will help families in high-tax states save more money. However, critics caution that raising this cap may result in less federal revenue, creating budget challenges for some states and potentially leading to reduced funding for public services like education and infrastructure.

Social Security Boosts Millions Amid Historic Policy Changes and Permanent Child Tax Credit

Social Security helps millions of Americans by providing monthly payments to retirees and others who qualify, ensuring they have steady income to meet their essential needs. In June 2025, beneficiaries who began receiving benefits before May 1997 got their first monthly payments on June 3. Everyone else will receive theirs over the next three Wednesdays, depending on birthdays. At the same time, the government is introducing major policy changes through a new bill called The One, Big, Beautiful Bill Act (OBBBA). This bill includes making the Child Tax Credit permanent, aiming to help more American families financially.

Social Security Hits Record High, But Payment Delays and Reform Talks Spark Uncertainty

As of June 2025, Social Security payments for retirees have hit a record high, with the average monthly check now exceeding $2,000. This landmark increase comes as part of ongoing cost-of-living adjustments (COLA), aimed at helping people manage rising expenses caused by continued inflation. However, the Social Security Administration faces challenges with sending out payments consistently, as some people are receiving their benefits earlier or experiencing unexpected delays. Additionally, political discussions around President Trump's proposed tax changes and possible reforms to the Social Security program have added further uncertainty about the program's future.

House Passes Landmark Tax Reform Boosting SALT, Business Incentives, and Opportunity Zones

On June 1, 2025, the House of Representatives approved a major tax reform bill that could have important effects on American taxpayers and the economy. This new legislation plans to increase the limit on the State and Local Tax (SALT) deduction from $10,000 to $40,000 for households earning up to $500,000, gradually reducing benefits for higher-income earners. It also proposes making permanent and enhancing the qualified business income deduction to 23%, which could help small businesses save money on their taxes. Moreover, the bill brings back a provision allowing businesses to deduct the full cost of new machinery and equipment in the first year, potentially encouraging companies to invest more. Finally, it includes increased incentives for investing in Opportunity Zones, special areas designed to attract investment and stimulate economic growth in struggling communities.

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