Jill On Money: Tax season opens
Tax season has arrived and after the passage of the 2025 tax bill, millions are going to see changes from the previous year.
Here’s what you need to know before you begin the process:
Key dates and filing tips
The deadline is April 15, 2026. The IRS recommends electronic filing with direct deposit for faster refunds—typically within 21 days. For those who are still clinging to filing paper returns by mail, it can take four weeks or more to process your return – and the error rate on paper returns is higher than that of electronic ones.
Wait to file until you have received all income documents, like W-2s, 1099/1099-INT forms, unemployment benefits, dividends, pensions, and retirement distributions.
Standard vs. itemized deductions
After calculating gross income, you will reduce it through either the Standard or Itemized Deduction. About 90 percent of taxpayers file Standard, because it has increased steadily over the past decade.
This year it is $31,500 for married couples filing jointly (MFJ), $15,750 for single filers, and $23,625 for heads of household. The remaining 10% of filers will itemize individual expenses if their total exceeds the standard amount.
Changes for 2025
Several temporary provisions (2025-2028) offer new tax relief, but most have limitations.
Senior bonus
Taxpayers 65+ receive an additional $6,000 deduction per person, phasing out above $150,000 Adjusted Gross Income (AGI) for joint filers ($75,000 for others).
Tips and overtime
Qualified tip income gets a deduction up to $25,000, while overtime earns up to $12,500 ($25,000 joint). Both phase out at $150,000 individual/$300,000 joint.
Auto loan interest
Deduct up to $10,000 of passenger vehicle loan interest on new vehicles assembled in the U.S. A couple of caveats: The loan must have been taken out after December 31, 2024, and the deduction phases out at $100,000 individual/$200,000 MFJ.
SALT cap increase
The state and local tax deduction cap rises from $10,000 to $40,000 through 2029 for taxpayers earning under $500,000, then permanently reverts to $10,000.
Gig economy and side hustles
All income from part-time work, gig activities, or sales is taxable. If you earned $20,000 with over 200 transactions, you’ll receive Form 1099-K from payment processors. Regardless of receiving forms, report all income—including profits from selling personal items like clothing or furniture.
Free tax assistance
IRS Free File — Available for taxpayers with 2025 AGI of $89,000 or less through partnerships with tax software companies. Those above this threshold can use Free File Fillable Forms.
VITA program — Provides free preparation for individuals earning $69,000 or less, persons with disabilities, and limited English speakers. Tax Counseling for the Elderly serves those 60+ with retirement and pension questions.
MilTax — Offers free federal and up to three state returns for military members and some veterans, with no income restrictions.
If you don’t qualify for free assistance, don’t panic! Whatever software you use will prompt you to capture the relevant credits, deductions, and changes in the tax code.
That said, if you have a complicated financial life, you may want to pay for guidance. For example, small business owners may want someone who is familiar with Schedule C and for whom you should file a Form 1099 to report any payments you made to others.
If you had a lot of investment activity, sold property, or have to file an estate tax return for a deceased family member, you may also want guidance.
Check out the IRS website for tips on how to choose a tax professional, but don’t dawdle… it’s tough to find someone to help with your taxes in April, so now’s the time to figure out whether or not it is necessary.
Jill Schlesinger, CFP, is a CBS News business analyst. A former options trader and CIO of an investment advisory firm, she welcomes comments and questions at askjill@jillonmoney.com. Check her website at www.jillonmoney.com.