New Tax Law Provisions — 2025
Standard Deduction
- Single or Married Filing Separately: $15,750
- Head of Household: $23,625
- Married Filing Jointly / Qualified Surviving Spouse: $31,500
Senior Deduction
Additional deduction of $6,000 per person age 65 or older. Phases out when MAGI exceeds $75,000 ($150,000 MFJ).
Itemized Deductions — State and Local Taxes (SALT)
The SALT deduction limit increases to $40,000 ($20,000 MFS), reduced by 30% of modified AGI over $500,000 ($250,000 MFS), but not less than $10,000 ($5,000 MFS).
Child Tax Credit
Increases to $2,200 per qualifying child under age 17. SSNs for taxpayer(s) and child must be issued before the return due date.
Adoption Credit
Beginning in 2025, up to $5,000 of the adoption credit is refundable.
Energy Credits Terminated — 2025
| Credit Type | Expiration Date |
|---|---|
| Clean Vehicle Credit ($7,500 new EV) | No credit for vehicles acquired after Sept. 30, 2025 |
| Previously-Owned Clean Vehicle Credit ($4,000 used EV) | No credit for vehicles acquired after Sept. 30, 2025 |
| Qualified Commercial Clean Vehicle Credit | No credit for vehicles acquired after Sept. 30, 2025 |
| Energy Efficient Home Improvement Credit | No credit for property placed in service after Dec. 31, 2025 |
| Residential Clean Energy Credit | No credit for property placed in service after Dec. 31, 2025 |
Qualified Tuition Plan (529 Plan) Expansions
Effective for distributions made after July 4, 2025 — qualified expenses now include:
- K–12 tuition, curriculum materials, online instruction
- Tutoring or educational classes outside the home
- Standardized test or AP exam fees
- Dual enrollment in higher education
- Educational therapies for students with disabilities
- Postsecondary credentialing expenses
New Deductions — 2025
- Qualified Tips Deduction: Up to $25,000; phases out over $150k ($300k MFJ) MAGI.
- Overtime Pay Deduction: Up to $12,500 ($25,000 MFJ); phases out over $150k ($300k MFJ) MAGI.
- Vehicle Loan Interest Deduction: Up to $10,000 for qualified vehicle loan interest; phases out over $100k ($200k MFJ) MAGI.
Depreciation & Section 179
- Section 179 expense limit: $2,500,000
- Phase-out threshold: $4,000,000
- Special depreciation allowance: 100% (option to elect 40%)
Domestic Research & Experimental (R&E) Costs
Beginning in 2025, a full deduction is allowed for domestic R&E expenses (no amortization required).