Does OBBBA change the charitable deduction in 2026? Yes. Starting with the 2026 tax year, a new 0.5%-of-AGI floor and a 2/37ths cap on itemized deductions reduce the charitable deduction for most itemizers, but a new $2,000 above-the-line deduction and qualified charitable distributions give donors ways around them. Every November, a client calls our Los…
What are the new premium tax credit rules under OBBBA? The IRS and Treasury have issued proposed regulations (REG-101576-26) implementing H.R. 1 changes to Section 36B — the premium tax credit. The dollar cap on repayment of excess advance credits is gone starting with 2026 returns, new marketplace verification rules kick in after 2027, and…
What employee tax benefits can my business offer in 2026? The federal tax code pays for a surprising share of a competitive benefits package. The right employee tax benefits can lower a small employer’s net cost of paid leave, education, child care, retirement savings, and even a new Trump Account, through credits and exclusions that…
How does the clean fuel credit work after the OBBBA? The clean fuel credit under § 45Z still rewards low-emissions transportation fuel produced in the United States, but IRS Notice 2026-53 reshapes it for 2026. ILUC emissions are out. Non-North American feedstocks are out. Animal manure gets its own emissions rate. Here is what to…
This federal tax update covers three developments that reach small and mid-sized business owners directly. Congress moved a bipartisan taxpayer service package out of committee, Treasury opened a comment window on the renewed opportunity zone rules under the OBBBA, and the Joint Committee on Taxation corrected four points in its own OBBBA technical explanation —…
Can you deduct car loan interest in 2025? Yes, up to $10,000 per return per year, for tax years 2025 through 2028. The car loan interest deduction under OBBBA §70203 covers loans incurred after December 31, 2024 that are secured by a first lien on a U.S.-assembled passenger vehicle you bought for personal use. Final…
Does the IRS finally have an automatic-consent path for OBBBA R&E and residential construction changes? Yes. IRS Rev. Proc. 2026-32 opens the automatic OBBBA method change for § 174, § 174A, and § 460(e), waives the usual eligibility bars through 2027, and gives one transition window that closes November 15, 2026. On September 4, 2026,…
How do founders keep QSBS treatment through a recapitalization? A Section 368(a)(1)(E) tax-free recap can preserve QSBS under Section 1202(h)(4)(A), but only if the reorganization requirements are met, the aggregate gross assets threshold is respected, and Section 305 does not turn the recap into a taxable deemed distribution. Many of our founder clients organize as…
Which 2026 federal tax changes affect my small business? The ones with a date attached: an August guidance package implementing the 2025 reconciliation law, backup withholding on payment-app settlements, the employer paid leave credit, and a September 30 federal funding deadline that decides how fast the IRS answers you this fall. Most tax headlines never…
How much of my business interest is deductible after the OBBBA? The IRS just refreshed its answer. In August 2026, the IRS reissued its Section 163(j) FAQs to reflect the One, Big, Beautiful Bill Act. The core rule still caps the business interest deduction — but the way you calculate the cap, who qualifies as…
What did the OBBBA actually change for my nonprofit? Quite a lot. The OBBBA nonprofit tax rules created a new charitable deduction for non-itemizers, added floors that shrink deductions for high-income and corporate donors, expanded the §4960 excise on high pay, and set a tiered endowment tax for large private colleges. The One Big Beautiful…
How much of my overtime pay is actually tax-free? Less than most workers think. The new no tax on overtime deduction is capped at $12,500 (single) or $25,000 (joint), phases out above $150,000 MAGI, and applies only to the FLSA overtime premium — not the entire overtime paycheck. On August 6, 2026 the IRS released…
Is the pass through entity tax election still worth it after the higher SALT cap? For many owners of profitable pass-throughs in high-tax states, the answer is still yes — but the analysis is now owner-level, state-specific, and no longer automatic. The pass through entity tax (PTET) survived the 2025 SALT cap increase; the decision…
What records do I actually need to deduct my charitable donations? The IRS requires charitable donation records for every gift you claim — a bank record or written communication for cash, a written acknowledgment for anything $250 or more, and Form 8283 for larger noncash gifts. And beginning in 2026, non-itemizers can also deduct up…
What is a Trump Account and how do I open one for my child? A Trump Account is a new federally authorized investment account for children, created by the One Big Beautiful Bill Act as IRC Section 530A. The Trump Accounts guide below walks families through the $1,000 federal seed deposit, $5,000 annual contribution cap,…
Who can claim the new Federal Scholarship Tax Credit? Starting January 1, 2027, individual taxpayers can claim the Federal Scholarship Tax Credit — a federal credit of up to $1,700 for cash donations to Scholarship Granting Organizations (SGOs) in a participating state. Twenty-eight states have already opted in. Beginning next year, a new line item…
Who qualifies for the new $25,000 federal tip deduction? The tip deduction 2026 is an above-the-line deduction for workers in customarily tipped jobs — waiters, bartenders, stylists, rideshare drivers and roughly 70 other IRS-listed occupations — worth up to $25,000 of qualified tips for tax years 2025 through 2028, subject to income phaseouts. For decades,…
Are the Opportunity Zone rules changing? Yes. In IRS Notice 2026-40, the Treasury Department and the IRS announced that they intend to issue proposed regulations on Qualified Opportunity Zones under Internal Revenue Code §§ 1400Z-1 and 1400Z-2, as amended by the One, Big, Beautiful Bill Act (OBBBA). The notice provides transitional guidance for investments made…
Can I open and manage a Trump Account online? Yes. The IRS now lets taxpayers view and submit Trump Account elections directly inside their IRS Individual Online Account using Form 4547, Trump Account Election(s). A Trump Account is a new tax-advantaged account for a child under 18 with a valid Social Security number, created by…
What federal tax developments landed in early June 2026? Three Treasury/IRS regulatory proposals and a busy week on Capitol Hill. On the regulatory side: (1) proposed regulations under §892 (CC-00349656-26, IR-2026-69) giving sovereign investors transition relief and new applicability dates tied to the December 2025 proposed rules; (2) proposed regulations (REG-103193-26) raising the estate tax…
How did OBBBA expand the §4960 excise tax on nonprofit executive compensation? Internal Revenue Code §4960 imposes a 21% excise tax on a tax-exempt organization’s “excess remuneration” — compensation over $1 million paid to a covered employee — plus certain excess parachute (separation) payments. Under the One, Big, Beautiful Bill Act, beginning with tax years…
What are the most important federal tax developments from late May 2026? Four stand out. (1) The Joint Committee on Taxation released a 341-page provision-by-provision report on the One, Big, Beautiful Bill Act (OBBBA, P.L. 119-21) and flagged 10 provisions that may need technical correction. (2) Treasury and the IRS issued new guidance — final…
How did OBBBA change federal student loans for graduate and professional students? The One, Big, Beautiful Bill Act (OBBBA, Pub. L. No. 119-21) placed new caps on federal student loans and directed the U.S. Department of Education (DOE) to define which “professional degree” programs qualify for higher borrowing limits. Under the DOE’s final rule, only…
What is a Trump Account and how do you open one? A Trump Account is a new type of tax-advantaged individual retirement account for children, created by the One, Big, Beautiful Bill (OBBBA, enacted July 4, 2025). A parent, guardian, or other authorized individual can establish one for a child who is under age 18…
Do states follow the federal QSBS exclusion under OBBBA — and why does state conformity matter? Not automatically. The One Big Beautiful Bill Act (OBBBA, Pub. L. No. 119-21) expanded the federal Qualified Small Business Stock (QSBS) exclusion under IRC §1202 — but states set their own conformity. Maine and Oregon have enacted legislation DECOUPLING…
How should companies account for transferable tax credits under U.S. GAAP? The Financial Accounting Standards Board (FASB) voted in May 2026 to advance a project on the accounting treatment of nonrefundable transferable tax credits — including the Inflation Reduction Act (IRA) clean energy credits under IRC §6418, CHIPS and Science Act semiconductor credits, and One…
Who qualifies for the No Tax on Tips deduction under the final regulations? The Treasury and IRS issued final regulations on April 10, 2026 (IR-2026-49) implementing the “No Tax on Tips” deduction under the One, Big, Beautiful Bill Act (OBBBA). Workers in 70+ occupations on the Treasury Tipped Occupation Code (TTOC) list can deduct qualified…
How did the IRS 2026 filing season perform and what’s next for the agency? IRS CEO Frank Bisignano reported 134 million returns filed, a $3,400 average refund up 11%, and $2 billion collected from the agency’s five largest enforcement cases — even as House appropriators propose a 9% FY2027 budget cut. The IRS 2026 filing…
Are scammers exploiting the One Big Beautiful Bill? Yes — OBBBA tax scams are already active in 2026, with fraudsters targeting seniors, workers, and small business owners. This guide covers every major scam type so you can protect yourself and your finances. Tax season is stressful enough on its own. But whenever Congress passes major…
Can I deduct overtime pay from my federal taxes under the new law? Yes — the One, Big, Beautiful Bill Act (OBBBA) created an overtime tax deduction worth up to $12,500 for individuals ($25,000 joint filers) for qualifying FLSA overtime earned from 2025 through 2028. A separate tips deduction of up to $25,000 is also…
