Big Changes for Your Taxes:
Are You Eligible for New Deductions?

The tax landscape underwent a major transformation in July 2025, bringing about some of the most significant changes we've seen in decades. The most exciting news? Many of the new 2025 deductions are available to everyone, regardless of whether you itemize or take the standard deduction.

At Moyer Tax Services, we want to ensure you don't miss out on these opportunities. Here are the key changes that may impact your next filing.

Increased Child Tax Credit: For those with children aged 16 and younger, the child tax credit increases from $2,000 to $2,200 per child (2026) and is now indexed for inflation.

Enhanced Deduction for Seniors: Seniors age 65 and older are eligible for an additional $6,000 deduction (or $12,000 if married filing jointly) if their adjusted gross income is below $75,000 (or $150,000 if married filing jointly).

State and Local Taxes (SALT Cap): Previously limited to $10,000, the SALT cap is now $40,400 (2026) of deduction on your federal return for taxes paid to your state or local tax entities. This will cause more people to itemize, making charitable contributions, home mortgage interest, and medical expenses more valuable for tax purposes than they were in previous years. Phase-outs for this higher SALT cap occur at $500,000 of adjusted gross income.

Overtime Income: Up to $12,500 of overtime pay is deductible for those with less than $150,000 adjusted gross income ($300,000 for married filing jointly). Only the premium (the extra half in time-and-a-half) is deductible.

Tip Income: Up to $25,000 of tip income is deductible for those with less than $150,000 adjusted gross income ($300,000 for married filing jointly). Only those employees who are in an industry that commonly receives tips can claim this deduction.

New Car Interest: Up to $10,000 of personal vehicle interest is deductible for those with less than $100,000 adjusted gross income ($200,000 for married filing jointly). Only cars that are new (with a loan date of January 1, 2025, or later) and where final assembly occurred in the United States are eligible.

Charitable Deduction for Non-Itemized Return: Taxpayers taking the standard deduction can now deduct up to $1,000 ($2,000 for married filing jointly) for cash contributions made to qualified charities.

These updates represent just a fraction of the current legislation, and the details can get complicated fast. Some of these changes are permanent, while others are temporary and scheduled to expire after 2028. Because every person's situation is different, and because the window on the temporary provisions is limited, the smartest move is to plan ahead while they're still in effect. Reach out to the Moyer Tax Services team and we'll help you optimize your tax situation under the current law