Category Taxes & Tools

Starting in 2025, a new tax rule called the “Senior Bonus” deduction will give older Americans some extra help when filing their taxes. People aged 65 and older can get up to a $6,000 deduction, or $12,000 if they’re married and filing jointly. This benefit is meant to reduce taxes for seniors living on fixed or limited incomes. To qualify, single filers must have a Modified Adjusted Gross Income (MAGI) under $75,000, and married couples under $150,000. The deduction gradually goes away for those earning more, and it disappears completely at $175,000 for singles and $250,000 for couples. The good news is, seniors can claim this deduction even if they don’t itemize their taxes. This change is part of recent legislation meant to support older Americans as living costs continue to rise.

In 2025, major tax changes are happening that could greatly affect people who live in high-tax states like New York, California, and New Jersey. Thanks to the new One Big Beautiful Bill Act (OBBBA), the limit on how much you can deduct for state and local taxes (called SALT deductions) is going up from $10,000 to $40,000. That means many people will be able to lower their taxable income more, saving them money on their federal tax bill. However, this benefit starts to shrink if you make over $500,000, and it's mostly gone if you make over $600,000. The new rules are expected to make tax planning more important for higher earners and give middle-income families a bit of relief.

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, made major changes to the U.S. tax system by temporarily raising the SALT (state and local tax) deduction cap. This deduction lets taxpayers subtract the amount they pay in state and local taxes from their federal taxable income. From 2025 to 2029, the cap increases from $10,000 to $40,000 for individuals and to $20,000 for married people filing separately. However, this only fully applies to people earning less than $500,000 a year, with smaller increases for higher earners. The law also includes inflation adjustments and keeps current federal tax brackets as they are, avoiding an earlier plan that would have raised taxes on some households. This change is expected to help many taxpayers in high-tax states and could influence how people plan their finances over the next few years.

In 2025, American consumer spending is slowing down as higher import tariffs and global uncertainty change the way people use their money. Experts from major financial firms like Morgan Stanley and EY predict that spending growth will fall from 5.7% in 2024 to just 3.7% in 2025, with an even lower rate of 2.9% expected in 2026. One major reason is the sharp increase in tariffs—taxes on imported goods—which now average 18.6%, the highest in nearly a century. These costs make everyday items and big purchases like cars and appliances more expensive. As a result, people are thinking twice about spending and are shifting their lifestyles to save more and spend less.

President Trump’s recent “Big Beautiful Bill,” along with the SECURE 2.0 Act, has introduced major changes to how retirees manage their money. One of the biggest updates is that retirees can now wait until age 75 to start taking Required Minimum Distributions (RMDs) from their retirement accounts. This gives them more time to make smart tax moves. For example, during years when they have less income, retirees can move money from traditional IRAs into Roth IRAs. This means they pay taxes now, but the money can grow tax-free in the future. Plus, when this money gets passed on to family members, it won’t be taxed, making it a useful tool for leaving a financial legacy. These changes come at a time when inflation and market ups and downs make it more important than ever to plan ahead.

In July 2025, President Trump signed a major new law called the "One Big Beautiful Bill" (OBBB), which changes the way taxes work for millions of Americans. This law makes permanent some of the tax cuts from 2017, such as larger tax brackets and a nearly doubled standard deduction. That means many middle-class families, workers, and retirees will have lower taxable income and see simpler tax filing. The bill also increases the child tax credit to $2,200 per qualifying child and ties it to inflation, so it can grow over time. This helps families keep more of their money. In addition, the bill introduces new tax breaks designed to support certain groups, making it one of the most impactful tax reforms in recent years.