New Africa / Shutterstock.com · New Africa / Shutterstock.com The 2026 tax season 2026 is underway, and there's plenty for investors to think about. Indeed, with President Trump's reelection ushering in the One Big Beautiful Bill, Uncle Sam is handing out fresh deductions like tips, overtime, and car loan interest. That's great for the average Joe and Jane looking to capitalize on what could be one of the most prosperous tax return seasons in a long time. Quick Read Average refunds are up roughly 14% ...

In July, we passed the largest tax cuts in American history, including no tax on tips, no tax on overtime, no tax on Social Security for our great seniors. President Trump made a lot of proclamations about tax policy in his campaign and now throughout his administration. And it's very important for taxpayers to check what the president has said.What the tax breaks do is reduce your taxable income, and perhaps you will pay less tax, but it's not an outright elimination of tax for any of those things. Most of ...

In July, we passed the largest tax cuts in American history, including no tax on tips, no tax on overtime, no tax on social security for our great seniors. >> President Trump made a lot of proclamations about tax policy in his campaign and now throughout his administration. And it's very important for taxpayers to check what the president has said.What the tax breaks do is reduce your taxable income and perhaps you will pay less tax, but it's not an outright elimination of tax for any of those things. >> Mo ...

Core Points - The Working Families Tax Cuts Act represents the most significant tax overhaul in years, with changes effective from January 1, 2026, impacting 2027 tax filings [1] - Some provisions of the Act are retroactive for 2025, potentially increasing tax refunds for the current filing season [2] Group 1: Tax Deductions and Withholding - Individuals earning tips or overtime should update their W-4 forms, as the new law allows deductions of up to $25,000 for tips and $12,500 for overtime from taxable income, resulting in lower withholding [3][4] - The deduction limits for tips and overtime begin to phase out for incomes over $150,000 (or $300,000 for married couples filing jointly), but many individuals earning tips and overtime are likely below this threshold [4] Group 2: Filing Considerations - Taxpayers should review their 2025 pay stubs to accurately report tip income and overtime pay, as employers were not required to separate these figures on W-2 forms last year [5][6] - Only the premium portion of overtime pay is deductible, meaning if an individual earns $20 per hour and $30 for overtime, only the additional $10 per hour is eligible for deduction [6] Group 3: Vehicle Purchase Incentives - The new tax law allows a deduction of up to $10,000 in auto loan interest per year for new vehicles financed through 2028, provided they are assembled in the United States [7] - Eligible vehicles must weigh under 14,000 pounds and be for personal use, with the deduction phasing out for incomes over $100,000 for single filers or $200,000 for joint filers [8]

Your 2025 tax return could look different this year thanks to several tax law changes. Before you file this season, don't miss these new deductions, which could make your refund bigger. First up, there's no tax on qualified tips up to $25,000.According to the IRS, more than 6 million workers report tipped wages. And if you're working extra shifts, your first $12,500 in overtime is now tax-free for certain workers. Buy a car last year, you can now deduct up to $10,000 in auto loan interest.Eligible vehicles ...

Core Insights - Side gigs can be profitable for many Americans but come with tax complexities that require proper planning and understanding of deductions available to freelancers and gig workers [1] Group 1: Tax Deductions for Gig Workers - The Home Office Deduction is significantly underclaimed, with only an estimated 15% of eligible sole proprietors taking advantage of it, despite many working primarily from home [3] - Freelancers often miss or underclaim the home office deduction due to perceived risks, but it is legitimate if a specific area is used exclusively for business [4] - A general guideline suggests deducting between 8% and 15% of housing expenses, which can result in substantial savings depending on the city [4][5] Group 2: Vehicle and Mileage Deductions - Vehicle use is a valuable deduction for gig workers, especially for those who drive frequently, such as Uber and DoorDash drivers, who may overlook thousands of deductible miles [6] - Many freelancers fail to log business miles accurately, often confusing personal and business use, which can lead to mistakes in deductions [7] - It is important to choose between the standard mileage rate and actual expenses, as both cannot be used simultaneously [7] Group 3: Software and Digital Tools Deductions - Many freelancers neglect to deduct costs associated with software and digital tools that are essential for their work, despite these being eligible for deductions [8] - Business-related subscriptions and educational expenses related to digital tools like Canva, Zoom, and QuickBooks can also be deducted [8]

Core Insights - Taxpayers have until April 15, 2026, to file their taxes, but delaying can lead to mistakes and missed tax breaks [1] Group 1: Organization and Preparation - Utilizing a single digital folder for all tax-related documents can simplify the filing process and help maintain organization [2] - Even for simple tax situations, having organized documents prevents last-minute scrambling [3] - Reviewing the previous year's tax return is crucial as life changes can significantly impact the current tax situation [4][5] Group 2: Deductions and Credits - Tax credits and deductions vary yearly, and it is important to check what is available, such as the Earned Income Tax Credit (EITC), which ranges from $649 to $8,046 depending on the number of qualifying children [7] - Gathering all necessary documents in advance and considering professional assistance can ease the tax filing process [8]

Group 1 - The article discusses various legal strategies to lower tax bills, categorized into quick wins, opportunities for freelancers, and long-term wealth-building strategies [1] - Retirement accounts are highlighted as a primary method to reduce taxable income, with 401(k) contribution limits set at $24,500 for 2026, and catch-up contributions for those aged 50 and older potentially increasing this to $35,750 [2] - Health Savings Accounts (HSAs) are praised for their triple tax benefits, with contribution limits of $4,400 for individual coverage and $8,750 for family coverage in 2026 [3] Group 2 - The standard deduction for 2025 is noted to be $16,100 for single filers and $32,200 for married couples filing jointly, with advice to take the standard deduction unless itemized deductions exceed these amounts [4] - Common itemized deductions include mortgage interest, state and local taxes capped at $10,000, charitable donations, and medical expenses exceeding 7.5% of adjusted gross income [5] - Tax credits are emphasized as more beneficial than deductions, with the child tax credit providing up to $2,200 per qualifying child under 17 [6] Group 3 - Self-employed workers are identified as having significant opportunities for tax savings through business expense deductions, which can include home office space, internet and phone bills, and work-related subscriptions [8]

Core Insights - The article discusses the benefits and rules surrounding Required Minimum Distributions (RMDs) for retirement accounts like 401(k)s and traditional IRAs, emphasizing the tax advantages of contributions and the penalties for failing to withdraw the required amounts [1][2]. Group 1: RMD Rules and Penalties - RMDs begin in the year an individual turns 73, with the first withdrawal due by April 1 of the following year, and subsequent withdrawals required by December 31 each year [4][7]. - A penalty of 25% applies to the amount not withdrawn if RMDs are missed, with the potential to reduce the penalty to 10% if the mistake is corrected [5]. - Research from Vanguard indicates that failure to withdraw RMDs has cost Americans approximately $1.7 billion annually, with nearly 7% of Vanguard IRA holders missing their RMDs in 2024, incurring an average tax penalty exceeding $1,100 [6]. Group 2: Strategies to Avoid Missing RMDs - 401(k) RMDs are less likely to be missed due to proactive notifications from plan providers, while IRA holders are responsible for calculating and taking their withdrawals [8]. - It is recommended that individuals set up an automatic distribution plan with their financial institution to ensure compliance with RMD requirements [8].

Core Insights - The article discusses the potential tax benefits under Trump's One Big Beautiful Bill Act (OBBBA), particularly for seniors, families with children, and employees earning overtime [6][8] - It highlights that a significant portion of U.S. households could potentially pay $0 in federal income tax by 2025 due to the new tax deductions and credits [7][8] Tax Benefits for Seniors - A retired couple earning a combined adjusted gross income of $96,700 can reduce their taxable income significantly through the standard deduction and the new seniors deduction, resulting in a taxable income of $50,000 [2][6] - The article notes that a senior couple could potentially pay $0 in federal income tax due to capital gains and qualified dividends being taxed at a 0% rate [1][6] Tax Credits and Deductions - Families like Casey and Riley, with a combined income of $100,000 and two children, can utilize various deductions totaling $31,500, along with additional deductions for overtime pay, to lower their taxable income [5][4] - The maximum child tax credit has increased to $2,200 per child, which can further offset tax liabilities, potentially resulting in a $0 federal tax bill [3][6] Broader Implications of Tax Changes - Approximately 40% of U.S. households had a $0 federal tax bill in 2022, and this trend may continue with the new tax cuts favoring specific demographics [6][7] - The article mentions that while many may benefit from the new tax rules, higher-income households may not be able to reduce their tax bills to $0 [9] Financial Advisory Services - The article introduces financial advisory services like Range, which offers tax recommendations and investment advisory services at a lower cost compared to traditional advisors [10][11] - It emphasizes the importance of working with a financial advisor to navigate the new tax landscape and optimize tax strategies [13][18]