The IRS has announced changes for US citizens regarding their tax returns. Not considering these changes can be extremely detrimental because it has a direct impact on their annual income and tax liability.
In this case, we can review the list of changes to gain a better understanding. It’s important to identify the 5 most significant changes to consider when filing taxes.
It’s important to note that increasing tax brackets typically results in lower taxes, allowing us to earn more without having to pay more.
IRS Tax Return Changes in 2025
While not applicable to all Americans, many will notice these changes on their tax returns by 2025. Consider all of this when preparing your documentation.
So, the IRS Tax return changes for 2025 are:
Increases in standard deductions:
- Single filers: $15,000 (+$400).
- Married couples: $30,000 (+$800).
- Heads of household: $22,500 (+$600).
Adjustments in tax brackets:
- Increase in income thresholds to reflect inflation.
- Maximum rate of 37% applies to income over $626,350 (singles) and $751,600 (married couples).
Changes to the attorney tax credits:
- Increase in maximum Earned Income Tax Credit (EITC) amounts.
- 401(k) plan contribution limits increase $500, with additional contributions of up to $11,250 for individuals age 60 to 63.
Adjustments to the Alternative Minimum Tax (AMT):
- New exemption thresholds: $88,100 (singles) and $137,000 (married couples).
State and Local Tax (SALT) Deductions:
- The $10,000 limit on these deductions remains unchanged.
In case we have any doubts about this, we can always contact an advisor in order to complete the IRS Tax Return without any problems. But we must always keep in mind all these changes for the year 2025.
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