Tax Tips & Updates

Important updates every Tax Pros client should know. As we prepare for the new tax year, several major IRS updates, new government programs, tax law changes, and planning opportunities are rolling out. These updates will impact individuals, families, small businesses, and retirees. Below is your full breakdown of what’s new — including the introduction of the powerful new Trump Accounts, updates to deductions, credits, income limits, and more. 🔵 1. IRS Inflation Adjustments for 2026 The IRS has increased several important tax thresholds for the 2026 tax year (filed in 2027): Standard Deduction (Increased) Single: $16,100 Married Filing Jointly: $32,200 Head of Household: $24,150 These changes help reduce taxable income and offset inflation.   Tax Brackets Adjusted Upward All seven tax brackets (10% → 37%) now have higher income thresholds, helping many taxpayers avoid “bracket creep.”   Other IRS Adjustments Higher Earned Income Tax Credit (EITC) Higher Alternative Minimum Tax (AMT) exemption Estate tax exemption increases Foreign Earned Income Exclusion increases Higher contribution limits for FSAs, HSAs, and 401(k)s 🔵 2. New Federal Tax Law: One Big Beautiful Bill Act Signed in 2025, this law introduced major tax benefits and new savings programs. The biggest change is the introduction of Trump Accounts — a new tax-advantaged savings account for children. 🔵3. Introducing TRUMP ACCOUNTS A powerful new government-backed investment account for children. This is one of the most impactful programs for families in decades. Who Qualifies? Any U.S. child born between January 1, 2025 – December 31, 2028. Must have a Social Security Number.   Government Contribution Each eligible child receives a $1,000 one-time federal deposit to start the account.   How Much Can Be Contributed? Family contributions: Up to $5,000 per year Employer contributions: Up to $2,500 per year (tax-free to the employee) Contribution limits rise with inflation starting in 2027.   Investment Rules Funds must be invested in broad, diversified index funds (e.g., S&P 500 index funds). Growth is tax-deferred.   What Happens at Age 18? The Trump Account automatically converts into a Traditional IRA for the child. This gives children a head start on retirement savings that could grow for decades.     Why This Matters Free $1,000 from the federal government Long-term tax-deferred investment growth Employer contributions grow tax-free Helps build generational wealth A long-term alternative to 529 plans and custodial accounts   If you or someone in your family is expecting a child between 2025–2028, this is a major opportunity. 🔵 4. New Benefits for Seniors Taxpayers age 65 or older now qualify for an additional: $6,000 extra deduction $12,000 for married couples age 65+ This is in addition to the regular age/blindness deduction already available. Effective 2025–2028. 🔵 5. SALT Deduction Cap Increase The State & Local Tax (SALT) deduction cap has increased significantly: Up to $40,000 per married couple Up to $20,000 for single taxpayers This is great news for homeowners and taxpayers in higher-tax areas. Applies through 2029. 🔵6. New Worker Benefits: Tipped & Overtime Workers New provisions expected for the 2025 tax year (fully impacting 2026 filing): No Tax on Tips Some taxpayers may exclude up to $25,000 of qualifying tips. No Tax on Overtime Up to $12,500 of qualifying overtime pay may be excluded. IRS guidance is being finalized — more details coming soon. 🔵7. IRS Direct File Ending The IRS will no longer offer the Direct File system for the 2026 tax season. This means more taxpayers will need professional assistance — and Tax Pros is here to help. 🔵8. Retirement & Business Planning Updates Higher 401(k) and IRA contribution limits Expanded HSA and FSA flexibility Employer Trump Account contributions now allowed Stable depreciation and corporate tax rules Businesses should review their benefits plans to maximize deductions. 🔵WHAT CLIENTS SHOULD DO NOW If you have a newborn (2025–2028): Ask Tax Pros how to establish your Trump Account and secure your free $1,000. If you earn tips or overtime: New deductions may apply — keep good records. If you’re 65+: Take advantage of the new $6,000–$12,000 Senior Deduction. If you’re a homeowner: The increased SALT deduction may lower your taxes. If you are an employer: You can now contribute $2,500 per year tax-free to employees’ Trump Accounts. If you want to plan ahead: Schedule a consultation with a Tax Pros advisor. 📞 NEED HELP? WE’RE HERE. Tax Pros is committed to helping families, individuals, and businesses navigate all these new changes successfully. For questions or to schedule a consultation: 📞 954-434-7003 🌐 TaxProsUS.com 📧 Tax@TaxProsUS.com

Failing to report all income: Reporting all income, including freelance and gig work, is essential for avoiding tax mistakes. Claiming incorrect deductions: Double-check that you are claiming the correct deductions and that you have proper documentation for all deductions. Miscalculating estimated taxes: If you are self-employed or receive income that is not subject to withholding, it is important to accurately calculate and pay estimated taxes to avoid underpayment penalties. Failing to keep records: Keeping accurate records of all income and expenses is essential for avoiding tax mistakes and being able to prove your deductions if audited. Filing incorrect tax forms: Make sure to use the correct tax form for your filing status and type of income. Improperly reporting rental income: Rental income and expenses must be reported accurately on your tax return. Failing to report foreign income: If you have foreign income, make sure to report it on your tax return and be aware of any foreign tax credits or exclusions that may be available. Not taking advantage of tax credits: Tax credits can significantly reduce your tax bill, so make sure to research and claim all credits for which you are eligible. Failing to file a tax return: If you are required to file a tax return, it is important to file on time to avoid penalties and interest. Neglecting to sign and date your return: Make sure to sign and date your tax return before submitting it, as a return that is not signed is considered invalid.

Form 1040: The individual income tax return form used by U.S. taxpayers to report their federal income tax liability. Form W-2: The form used by employers to report wages, salaries, tips, and other taxable compensation paid to employees. Form 1099: The form used by self-employed individuals, businesses, and other entities to report miscellaneous income, such as rental income, interest, and dividends. Form W-4: The form used by employees to claim exemptions from federal income tax withholding. Form 1098: The form used to report mortgage interest paid by a homeowner to their lender. Form 2441: The form used by taxpayers to claim the child and dependent care tax credit. Form 8888: The form used to split a tax refund between multiple bank accounts or to direct the IRS to issue a refund in the form of U.S. savings bonds. Form 1095-A: The form used by individuals enrolled in a Marketplace insurance plan to report their health insurance coverage for the year. Form 8949: The form used to report sales and other dispositions of capital assets, such as stocks, bonds, and mutual funds. Form 941: The form used by employers to report their quarterly payroll taxes, including federal income tax, Social Security, and Medicare taxes withheld from employees’ paychecks

January 15th: The deadline for individuals to make a final payment of estimated tax for the previous year. April 15th: The deadline for individuals to file their tax returns or request an extension. June 15th: The deadline for U.S. citizens living abroad to file their tax returns or request an extension. September 15th: The deadline for individuals to file an extension for their tax returns. October 15th: The deadline for individuals who filed an extension to file their tax returns. January 31st: The deadline for employers to furnish W-2 forms to employees and the deadline for self-employed individuals to furnish 1099 forms to their clients. February 28th: The deadline for banks and other financial institutions to furnish 1099 forms to their customers. March 31st: The deadline for U.S. corporations to file their tax returns. April 30th: The deadline for partnerships and S corporations to file their tax returns. September 15th: The deadline for tax-exempt organizations to file their annual return or request an extension.