TAX INFORMATION

Education Credits

To claim education-related tax credits such as the American Opportunity Credit or the Lifetime Learning Credit, students must provide Form 1098‑T. This form is typically obtained directly through the student’s online school portal. Please note that income limits apply when determining eligibility for these credits.

Student Loan Interest

Taxpayers who paid interest on qualified student loans should retrieve Form 1098‑E from their loan servicer. If less than $600 in interest was paid during the year, the form may not be mailed and must instead be accessed online. Eligibility to deduct this interest is also subject to income limitations.

Energy‑Related Credits (Expire 12/31/25)

Homeowners may qualify for energy‑related tax credits, including the Energy‑Efficient Home Improvement Credit and the Residential Clean Energy Credit for systems such as solar, wind, geothermal, and battery storage. Receipts and documentation of qualifying improvements are required. These credits are scheduled to expire on December 31, 2025

Clean Vehicle Credit
The Clean Vehicle Credit, which applied to the purchase of qualifying new electric vehicles, expired on September 30, 2025. Taxpayers who purchased an eligible vehicle prior to expiration should provide all relevant purchase documentation.

Vehicle Loan Interest Deduction

Taxpayers may be able to deduct up to $10,000 in interest paid on a qualified vehicle loan. Income limits apply when determining eligibility, and this deduction is currently scheduled to remain available through 2028.

Casualty Losses

Casualty loss deductions are available only for losses occurring in a federally declared disaster area. Taxpayers must also disclose any insurance reimbursements received or expected related to the loss.

Charitable Contributions
Taxpayers claiming charitable contributions of $250 or more must have written acknowledgment from the organization. Contributions exceeding $5,000 require a qualified appraisal. For vehicle donations, Form 1098‑C is required to substantiate the gift.

NJ Veterans Exemption
New Jersey taxpayers who were honorably discharged from the U.S. Armed Forces may qualify for a Veterans Exemption. A copy of the DD‑214 is required to verify eligibility.

Retirement Accounts & Distributions

Required Minimum Distributions (RMDs)

RMDs begin at age 73 (increasing to 75 in 2033).

Applies to pre-tax retirement accounts (not Roth IRAs).

Inherited retirement accounts (non-spousal beneficiaries) generally must be fully withdrawn within 10 years.

Retirement Contributions

Consult our office before contributing.

Employer Plans (401(k), 403(b), 457, TSP):

· 2025: $23,500

· 2026: $24,500

Catch-up contributions:

o Ages 50+: $8,000

o Ages 60–63: $11,250

Traditional & Roth IRAs:

· 2025: $7,000

· 2026: $7,500

Catch-up (age 50+):

o 2025: $1,000

o 2026: $1,100

Retirement Distributions

· Form 1099-R is required for all withdrawals, including rollovers.

The One Big Beautiful Bill Act (OBBBA) – Selected 2025 Updates
This is a partial summary of the most commonly applicable provisions.

Additional Senior Deduction
Beginning in 2025 and continuing through 2028, qualifying seniors may claim an additional $6,000 deduction. This benefit is available to both itemizers and non-itemizers, though income limits apply when determining eligibility.

Increased SALT Deduction
For 2025, the State and Local Tax (SALT) deduction cap increases to $40,000. This cap will rise by 1% each year through 2029. Income limitations apply, and the deduction is scheduled to revert to the previous $10,000 cap after December 31, 2029.

Trump Savings Account
A new tax‑deferred “Trump Savings Account” is available for children beginning in 2025. Families may contribute up to $5,000 annually using after‑tax funds. Additionally, for qualifying newborns between 2025 and 2028, the federal government will contribute $1,000 to the account.

No Tax on Overtime
Overtime earnings may be deducted up to $12,500 for single filers and $25,000 for joint filers. These deductions apply only to federal income tax—Social Security and Medicare taxes remain applicable. Income limits may also apply.

No Tax on Tips
Qualifying tipped workers may deduct up to $25,000 in tip income. Eligibility is subject to income limitations.

Auto Loan Interest Deduction
Interest paid on loans used to purchase new vehicles assembled in the United States may be deductible. This deduction is available to both itemizers and non-itemizers, subject to income limits.

Increased Child Tax Credit
The Child Tax Credit increases to a maximum of $2,200 for tax year 2025. The credit is permanently extended and will be adjusted annually for inflation going forward.

Other Key Tax Items

Gifts (2026)

For 2026, the annual gift exclusion increases to $19,000 per recipient. The lifetime exemption rises to $15 million.

Foreign Accounts & Assets

Taxpayers with foreign financial accounts or assets must report them. Please notify our office if this applies to you so that proper reporting can be completed.

Corporate Transparency Act

Corporations, LLCs, and similar entities are subject to new beneficial ownership reporting requirements. Filings must be submitted through the Financial Crimes Enforcement Network at https://fincen.gov/boi.

Social Security Wage Base

The Social Security wage base increases to $176,100 for 2025 and to $184,500 for 2026.

Crowdfunding

Crowdfunding proceeds are generally not taxable if they are properly classified as gifts. Supporting documentation should be retained.

Gambling Income

Form W‑2G is issued for certain gambling winnings, including:

Bingo and slot winnings of $1,200 or more
Keno winnings of $1,500 or more
Poker tournament winnings of $5,000 or more
Online sports betting winnings of $600 or more

2026 Year‑End Tax Checklist & Planning Tips

Documents to Gather

Use your prior year’s tax return as a reference checklist when assembling documents. Most tax forms arrive by January 31, while investment forms often come after February 15. K‑1 forms have no required delivery date, so you may need to follow up with the issuing entity.
If you sold property, include your closing disclosure from the sale.
If you created a trust, provide the trust agreement and EIN confirmation letter.
Please notify us of any address changes, banking changes, or moves to a different state (including the exact move date).

Planning Ahead

If you expect to withdraw retirement funds, contact our office beforehand to discuss potential tax implications.
If you plan to sell property, inform us early—capital gain exclusions of $250,000 for single filers and $500,000 for married filers may apply.
Be aware that bonuses and commissions are often under‑withheld.
Self‑employed individuals and small business owners should track income and expenses separately and review retirement contribution options.
For rental properties, keep accurate records of income, expenses, and improvements throughout the year.