2025 Tax Changes You Need to Know Before Filing in 2026

Tax law doesn’t change often but when it does, the ripple effects can meaningfully impact how much you owe, how much paperwork you need, and which planning strategies actually matter.

For your 2025 tax return (filed in early 2026), several notable updates are now in play following the passage of the One Big Beautiful Bill Act (OBBBA). The theme this year is simplicity paired with targeted relief: larger standard deductions, new above-the-line deductions, and meaningful benefits for seniors and working families.

Below is a practical guide to the most important changes and how they may affect your tax planning.

Standard vs. Itemized Deductions: Why Paperwork Is Getting Easier

For 2025, the standard deduction increased again, pushing more taxpayers away from itemizing and toward a simpler filing experience.

2025 Standard Deduction Amounts

• Single: $15,750

• Married Filing Jointly: $31,500

For many households, these higher thresholds mean itemizing no longer produces a tax benefit. If your total itemized deductions don’t exceed these amounts, the standard deduction will result in a lower tax bill with far less record-keeping.

The “Standard” Advantage

If you take the standard deduction, you no longer need to track or report many common expenses, including:

• Mortgage interest (Form 1098)

• Property taxes

• Vehicle ownership or ad valorem taxes

• Many miscellaneous deductions

Unless your combined deductions—including medical expenses and charitable contributions—exceed $15,750 (Single) or $31,500 (MFJ), itemizing generally won’t move the needle.

Special Tax Benefits for Seniors (Age 65+)

Taxpayers who turn 65 by December 31, 2025 receive additional layers of tax relief beyond the standard deduction.

Standard Age Bonus

• Single: Additional $2,000

• Married Filing Jointly: Additional $1,600 per qualifying spouse (up to $3,200)

New Enhanced Senior Deduction (2025)

A new flat $6,000 per person deduction is available for seniors.

Income limits for the full deduction:

• Single: MAGI under $75,000

• Married Filing Jointly: MAGI under $150,000

This benefit stacks on top of existing deductions and can meaningfully reduce taxable income for retirees and near-retirees.

New Above-the-Line Deductions (Available Even If You Use the Standard Deduction)

One of the most impactful changes under OBBBA is the expansion of above-the-line deductions. These deductions apply whether or not you itemize—allowing you to benefit from both simplicity and targeted tax breaks.

Charitable Contributions

• Deduct cash gifts to public charities up to:

  • $1,000 (Single)

  • $2,000 (Married Filing Jointly)

No Tax on Tips

• Deduct up to $25,000 in tip income

• Income limits:

  • $150,000 (Single)

  • $300,000 (MFJ)

Car Loan Interest Deduction

• Deduct up to $10,000 in interest paid on a new vehicle loan

• Requirements:

  • Personal-use vehicle

  • Final assembly in the United States

• Income limits:

  • $100,000 (Single)

  • $200,000 (MFJ)

These deductions create new planning opportunities—especially for working households, service industry professionals, and families financing large purchases.

Other Notable 2025 Tax Highlights

A few additional changes worth noting:

• SALT Cap Increase: For those who do itemize, the State and Local Tax (SALT) deduction cap increases to $40,000, up from $10,000.

• Child Tax Credit: Increased to $2,200 per qualifying child.

• No Tax on Overtime: A new deduction allows you to exclude:

  • Up to $12,500 (Single)

  • Up to $25,000 (Married Filing Jointly) of overtime pay from taxable income.

Final Thoughts: Why Planning Matters More Than Ever

While many of these changes simplify filing, they also reinforce an important reality: tax planning is no longer just about deductions - it’s about coordination.

Understanding how standard deductions, above-the-line benefits, income thresholds, and age-based rules interact can materially impact your long-term plan, especially if you’re approaching retirement, managing variable income, or balancing work with family responsibilities.

If you’re unsure how these updates apply to your situation, now is the right time to review your strategy - before filing season arrives. Small adjustments made early can lead to meaningful tax savings later.

About Rigden Capital Strategies

Rigden Capital Strategies was founded on a simple belief: financial advice should be personal, transparent, and centered around your goals—not built on generic models or product-driven sales. With decades of combined industry experience, we’ve developed a process grounded in three core values: value, integrity, and progress.

As a fee-only fiduciary, we provide personalized, goals-based wealth planning services designed to adapt with your life. Our services include investment management, retirement and tax planning, and estate coordination. We use a mix of active and passive strategies to help clients navigate market changes with clarity and confidence.

We believe in building real relationships and delivering clear, actionable strategies—focused on long-term planning and aligned with your objectives.

Your goals, our strategies. Together, let’s make your goals happen.

Disclosure: This content is for informational and educational purposes only and should not be interpreted as financial, legal, or tax advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information provided. Investment decisions should be based on individual circumstances, and we recommend consulting a qualified professional before implementing any financial, legal, or tax strategies. Past performance is not indicative of future results, and all investments carry risks, including potential loss of principal. No investment strategy can guarantee success or protect against loss in all market conditions. Investors should carefully consider their risk tolerance, investment objectives, and financial circumstances before making investment decisions.