Tax

Hello friend,

The 2026 tax season is officially underway, and there are significant updates you need to know about!

The IRS suggests using online tools and taking simple preparatory steps to secure the expanded tax benefits offered by the "One, Big, Beautiful Bill". Whether you are claiming the Child Tax Credit, the Adoption Credit, or managing education expenses, here is what you need to do to ensure a smooth filing process.

🗓️ Important Date for Refund Seekers

If you are an early filer claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC), mark your calendars:

• February 21: Start checking the "Where’s My Refund?" tool for your personalized refund date.

• March 2: This is the earliest date most EITC/ACTC filers can expect their refunds (provided you filed electronically and chose direct deposit).

🚀 3 Ways to Speed Up Your Refund

The IRS is phasing out paper checks. If you want your money quickly and securely, follow these steps:

• File Electronically: Avoid the "paper trail" delays.

• Use Direct Deposit: This remains the fastest way to get your funds. Mail-in refunds can now take six weeks or longer.

• Open an IRS Online Account: You can track your refund, manage payments, and view your tax history securely at any time.

🔍 Double-Check Before You File

To avoid processing delays or audits, the IRS recommends a quick "pre-flight" check of your return:

• Verify SSNs: Ensure all Social Security numbers for dependents match their physical Social Security cards exactly.

• IP PINs: If you have an Identity Protection PIN, make sure it is entered correctly.

• Credit Selection: Double-check that the correct credits are marked in the "Dependents" section.

• Review Everything: Even if you use a professional preparer, you are legally responsible for the information on your return.

📖 Learn More

The One, Big, Beautiful Bill has several moving parts. To see how these provisions specifically affect your family or education costs, visit the official “One, Big, Beautiful Bill Provisions” page on IRS.gov.

Stay ahead of the curve this tax season! If you have any questions about how these changes impact your specific situation, feel free to reach out.

Hello friend,

The IRS has released the 2026 standard mileage rates, and there’s a notable change that business owners and self-employed taxpayers should know about.

📈 Business Mileage Rate Increases

Starting January 1, 2026, the standard mileage rate for business use of a vehicle will increase to:

➡️ 72.5 cents per mile (up 2.5 cents from 2025)

This higher rate reflects increased vehicle operating costs and inflation, and it can make a meaningful difference if you regularly drive for work.

📉 Other 2026 Mileage Rates

Here’s the full breakdown for 2026:

• Business use: 72.5¢ per mile ⬆️

• Medical purposes: 20.5¢ per mile ⬇️ (down 0.5¢)

• Moving purposes (eligible active-duty military & certain intelligence community members): 20.5¢ per mile ⬇️

• Charitable use: 14¢ per mile (unchanged)
   

✅ These rates apply to gas, diesel, hybrid, and fully electric vehicles.

🧾 Who Can Still Deduct Mileage?

While unreimbursed employee travel expenses are generally no longer deductible, mileage deductions are still available for:

• Business owners & self-employed individuals

• Certain educators

• Select government officials, reservists, and performing artists

• Active-duty military (and certain intelligence community members) for moving expenses
   

⚖️ Standard Mileage vs. Actual Expenses

Using the standard mileage rate is optional. You can always choose to deduct actual vehicle expenses instead — but keep these rules in mind:

• If you own the vehicle, you must choose the standard mileage method in the first year it’s used for business if you want that option later.

• If you lease the vehicle, you must use the standard mileage rate for the entire lease period, including renewals.
   

💡 Why This Matters

That extra 2.5 cents per mile adds up fast — especially for consultants, real estate professionals, gig workers, and anyone running errands or visiting clients regularly. Good mileage tracking in 2026 could mean a bigger deduction and lower tax bill.

Notice 2026-10 sets out the optional standard mileage rates for 2026, along with the maximum automobile cost used to determine mileage reimbursement allowances under fixed and variable rate plans. It also specifies the maximum fair market value of employer-provided vehicles first made available for employees’ personal use in 2026, for which employers may apply either the cents-per-mile valuation method or the fleet-average valuation method.

If you’d like help deciding whether the standard mileage rate or actual expenses make more sense for your situation, just let us know. We also have a tax-focused mileage tracking tool coming soon in our AI.JUJU (beta) app—stay tuned!

Hi Friend,

The IRS has officially released Notice 2026-11, providing the first wave of implementation guidance for the One, Big, Beautiful Bill (OBBB). If your business invests in equipment, technology, or even sound recording, the landscape of "bonus depreciation" has changed significantly—and mostly for the better.

The Big Win: 100% Write-Offs are Permanent

Previously, bonus depreciation was scheduled to phase out. The OBBB has reversed this, making the 100% additional first-year depreciation deduction permanent for qualified property acquired after January 19, 2025.

This interim guidance establishes the framework for electing additional first-year depreciation on eligible property. 

Key Provisions You Need to Know:

• Strategic Flexibility (The 40% Election): For qualified property placed in service during the first tax year ending after Jan. 19, 2025, you can choose to claim a 40% deduction (or 60% for certain aircraft/long-production property) instead of the full 100%. This is a powerful tool if you prefer to save your deductions for future years when your tax bracket might be higher.

• Entertainment Industry Expansion: In a first for the tax code, qualified sound recording productions now qualify for bonus depreciation. A production is generally eligible if recording began after July 4, 2025.

• Self-Constructed Property: If you are building a larger facility, you can now elect to treat specific acquired or self-constructed components as eligible for the 100% deduction immediately, even if the larger project takes longer to complete.

Why This Matters for Your 2026 Planning

The IRS has stated that taxpayers can rely on this interim guidance immediately. This provides the certainty needed to make major capital investments today, knowing exactly how they will impact your bottom line.

Note: These rules are complex, particularly regarding "binding contracts" and specific "placed in service" dates.

Do you need help running a comparative tax projection to see if the 100% deduction or the 40% election provides a better cash-flow outcome for your specific 2025/2026 filing? Contact us today!

Dear Friend,

The Internal Revenue Service has officially announced the start of the 2026 tax filing season. With the implementation of the "One, Big, Beautiful Bill," this year brings several significant changes to federal taxes, credits, and deductions that could impact your bottom line.

Here is everything you need to know to prepare for a successful filing season.

🗓️ Key Dates to Remember

 * January 9: IRS Free File opens for qualified taxpayers.

 * January 26: Official opening of the 2026 filing season; IRS begins processing all returns.

 * April 15: Deadline to file 2025 Individual tax returns and pay any tax due.

🚀 Major Tax Law Updates (The "One, Big, Beautiful Bill")

This year introduces the new Schedule 1-A, which allows taxpayers to claim several newly enacted deductions. You may now be eligible for:

 * No Tax on Tips: Keeping more of your gratuities.

 * No Tax on Overtime: Rewarding extra hours worked.

 * Car Loan Interest Deductions: Relief for vehicle owners.

 * Enhanced Senior Deductions: Increased support for older Americans.

🏦 New Financial Tools & Accounts

 * Trump Accounts: A new type of individual retirement account is now available for children. Parents and guardians can visit trumpaccounts.gov to learn more.

 * Direct Deposit is Essential: Per the "Modernizing Payments To and From America’s Bank Account" executive order, the IRS is phasing out paper refund checks. Taxpayers are strongly encouraged to use bank accounts for direct deposits to ensure they receive their refunds.

💻 Digital Filing & Resources

 * IRS Individual Online Account: Log in to view your balance, payment history, and tax records in real-time.

 * Where’s My Refund?: Check your status just 24 hours after e-filing.

 * Forms 1099-K & 1099-DA: If you received payments via apps, online marketplaces, or digital asset (crypto) brokers, ensure you review the reporting requirements on IRS.gov.

🆘 Need Help Filing?

 * IRS Free File: Available starting Jan. 9 for those who qualify.

 * Volunteer Programs: The VITA and TCE programs offer free tax prep for qualified individuals and seniors.

 * MilTax: Specialized free filing software for military members and veterans.

 * Taxpayer Assistance Centers: If you can't resolve an issue online, you can schedule an in-person appointment for professional help.

 * Hire a Tax Professional like the JUJU Accounting Team: If you need personalized, comprehensive tax advice or filing assistance, work with a credentialed professional.

A Note on Security: As the season begins, please remain vigilant against tax scams and identity theft. The IRS will never contact you via social media or text message to request personal financial information.

For more tools and resources to help lower your tax bill and increase your refund, visit IRS.gov or reach out to JUJU Accounting.

Hi Friend,

We are writing to share important updates regarding a major new tax benefit introduced under the "One, Big, Beautiful Bill." 🏛️ The Department of the Treasury and the IRS recently released official guidance on the Car Loan Interest Deduction, which offers a significant tax break for many American drivers.

If you are planning to purchase a new vehicle, this is a provision you need to know about! 🏎️💨

What Is the New Deduction? 📋

Starting with tax years following December 31, 2024, taxpayers may be eligible to deduct interest paid on loans used to purchase new, made-in-America vehicles for personal use. 🇺🇸

Key Highlights of the Guidance:

 - Available to Everyone: 🙌 Unlike many other deductions, this is available to both taxpayers who take the standard deduction and those who itemize.

 - "Made in America" Requirement: The deduction applies specifically to vehicles where the "final assembly" occurred in the United States. 🛠️

 - Deduction Limit: There is an annual deduction limit of $10,000. 💰

 - Personal Use: The guidance clarifies the rules for determining if a vehicle qualifies as being for "personal use" rather than business. 🏠

 - Lender Reporting: To make claiming the deduction easier, lenders are now required to file information returns reporting the interest you’ve paid. 📑

What Happens Next? 🗓️

The IRS is currently operating under "proposed regulations" and is inviting public comment through February 2, 2026. Tax professionals can submit comments through Regulations.gov. The proposed regulations include instructions for submitting comments.

How Can We Help? 🤝

Navigating "Made in America" assembly requirements and loan eligibility can be complex. If you are considering a new vehicle purchase and want to ensure your loan and choice of car qualify for this $10,000 deduction, please reach out to us! 📞

We will continue to monitor updates to the "One, Big, Beautiful Bill" to ensure you receive every benefit you are entitled to. ✨

Hi Friend,

If business tax season feels stressful, it’s usually not because taxes are complicated—it’s because preparation starts too late.

This week’s focus: a simple business tax preparation checklist to help you stay organized, avoid surprises, and make better financial decisions all year long.

📋 Your Business Tax Prep Checklist

Before filing, make sure these five items are in order:

1. Prior-Year Tax Return

This is your baseline. It helps identify carryovers (losses, credits), changes in income, and missed planning opportunities.

2. Clean Accounting Records

Up-to-date profit & loss statements, balance sheets, and cash flow reports ensure income and expenses are reported correctly—and defensible if ever questioned.

3. Depreciation Schedule

Long-term assets like equipment, vehicles, or technology are deducted over time. Your depreciation schedule shows what’s already been claimed and what’s still available.

4. Asset Purchase & Lease Records

Invoices, contracts, and payment details matter. Some purchases may qualify for immediate deductions, while others must be depreciated properly.

5. Owner or Shareholder Activity

For partnerships and corporations, track capital contributions and distributions carefully to avoid basis and reporting issues.

🧠 Tax Planning Isn’t a Once-a-Year Task

The most effective tax strategies happen before filing—not during it.

Ongoing tax planning helps you:

• Evaluate whether your entity type still makes sense

• Time income and expenses more effectively

• Reduce estimated tax penalties

• Align tax decisions with business growth goals

Think of tax planning as part of your operating system, not just compliance.

🔧 Habits That Make Tax Season Easier

A few proactive moves go a long way:

• Set internal deadlines for gathering tax documents

• Keep business and personal finances completely separate

• Maintain organized records year-round

• Plan deductions and credits intentionally

• Consider retirement contributions to reduce taxable income

• Work with a tax professional before decisions are made

📅 Don’t Miss These Key Deadlines

• March 15 – Partnerships, Multi-member LLCs, S-Corps

• April 15 – Individuals, Sole proprietors, Single-member LLCs, C-Corps

• Estimated Tax Payments – April 15, June 15, September 15, January 15

(Moved to the next business day if the due date falls on a weekend or holiday.)

Bottom Line

Good tax outcomes rarely come from last-minute filing—they come from preparation, structure, and planning.

If you want help reviewing your setup or creating a year-round tax strategy, that’s what we’re here for.

We have some exciting news regarding Health Savings Accounts (HSAs). The Department of the Treasury and the IRS recently released Notice 2026-05, providing guidance on the One, Big, Beautiful Bill (OBBB). These updates significantly expand who can contribute to an HSA and how those funds can be used.

Here are the three major updates you need to know:

1. Permanent Telehealth Access

The ability to receive telehealth and remote care services before meeting your deductible has now been made permanent. Effective for plan years starting on or after January 1, 2025, you can utilize these services without jeopardizing your HSA contribution eligibility.

2. Expanded Plan Compatibility (Bronze & Catastrophic)

Starting January 1, 2026, more people than ever will be able to open and fund an HSA.

• The Change: All Bronze and Catastrophic plans are now considered HSA-compatible.

• The Detail: This applies whether the plan was purchased through a state/federal Exchange or directly from an insurer, regardless of whether it meets the traditional "High Deductible Health Plan" (HDHP) definition.

3. Direct Primary Care (DPC) Inclusion

For those who prefer Direct Primary Care arrangements (a model where patients pay a periodic fee directly to their doctor), there is great news starting January 1, 2026:

• Enrolling in a DPC arrangement will no longer disqualify you from contributing to an HSA.

• You can now use your HSA funds tax-free to pay for your periodic DPC membership fees.

📢 Have Your Say

The IRS is currently inviting public comments on these new rules. If you wish to provide feedback on these changes:

• Deadline: March 6, 2026

• How to submit: Use the Federal e-Rulemaking portal (reference IRS-2025-0335) or mail your comments to the Ben Franklin Station in Washington, DC.

Want to dive deeper?

For a full breakdown of these provisions, visit the official One, Big, Beautiful Bill page on IRS.gov.

Stay healthy and stay informed!

Adoption can be a beautiful—and expensive—journey. The good news? Recent improvements to the Adoption Tax Credit are making adoption more affordable for many families starting in tax year 2025.

Below is a clear, practical breakdown of what’s changed, who may qualify, and how to claim the credit.

What Is the Adoption Tax Credit?

The Adoption Tax Credit helps offset qualified expenses paid to legally adopt an eligible child. The credit applies to:

• International adoptions

• Domestic private adoptions

• Public foster care adoptions

If you finalized an adoption in 2025 or began the adoption process before 2025, you may be eligible.

Key Improvements Starting in 2025

Here’s what’s new—and important—for taxpayers:

🔹 Higher Maximum Credit

The maximum Adoption Tax Credit for 2025 is $17,280 per eligible child.

🔹 Partial Refundability (Big Change)

• The credit is now partially refundable.

• Taxpayers may receive up to $5,000 per qualifying child as a refund, even if their tax liability is lower.

• Any nonrefundable amount can still be carried forward, but carried-forward amounts cannot be used to calculate refundable credit in future years.

🔹 Expanded Special Needs Determinations

• Indian tribal governments now have the same authority as states to determine whether a child has special needs.

• If you adopt an eligible U.S. child with special needs, you may qualify for the credit even if you paid little or no qualified adoption expenses.

Who Is an Eligible Child?

To qualify:

• The child must be under age 18, or

• Be physically or mentally unable to care for themselves, regardless of age

Who Does Not Qualify?

The Adoption Tax Credit cannot be claimed if:

• You adopt your spouse’s child

• The arrangement is a surrogate parenting agreement

Qualified Adoption Expenses

The credit covers reasonable and necessary expenses, including:

• Adoption agency fees

• Court costs and legal fees

• Adoption-related travel (meals and lodging)

• Other expenses directly related to the legal adoption

💡 Expenses may qualify even if paid before a specific child is identified. For example, home study fees paid early in the process can still count.

How to Claim the Credit

To calculate and claim the Adoption Tax Credit:

• Complete Form 8839 – Qualified Adoption Expenses

• Attach it to your federal tax return

• Taxpayers can also use the IRS Interactive Tax Assistant to help determine eligibility.

Final Thought

The updated Adoption Tax Credit is one of the most meaningful family-focused tax improvements in recent years—especially with partial refundability now in place. If adoption is part of your story (or your plans), this credit could make a real financial difference.

As always, everything should be reviewed carefully—and it never hurts to double-check.

If you’d like help determining eligibility or properly claiming the credit, the JUJU Accounting team is here to help.

The Treasury Department and the IRS just released major new guidance on a brand-new type of retirement-style savings vehicle for children: Trump Accounts. These accounts were created under the Working Families Tax Cuts Act and are designed to jump-start long-term savings for eligible children with the help of federal, charitable, and employer contributions.

Below is a concise breakdown of what families, employers, and financial institutions need to know as the IRS prepares to release formal regulations.

🌟 What Is a Trump Account?

A Trump Account is a new type of individual retirement account (IRA) that can be established on behalf of an eligible child. A parent or guardian must make an election to create the account, and the child must be under age 18 as of the end of the calendar year when the election is made.

The IRS has released Notice 2025-68, which outlines initial guidance on contributions, investments, distributions, and reporting.

📅 When Can Contributions Begin?

Although accounts may be established earlier, no contributions can be made before July 4, 2026.

🎁 $1,000 Federal Pilot Program Contribution

The federal government will make a one-time $1,000 contribution for qualifying children who meet all of the following criteria:

• A Trump Account election is made on their behalf

• The child is a U.S. citizen

• The child is born between Jan. 1, 2025 and Dec. 31, 2028

This contribution is automatic once the account is established and the child qualifies for the program.

💸 Who Can Contribute & How Much?

1. Parents, relatives, or other individuals

• Up to $5,000 per child per year

• Contributions from all individuals combined cannot exceed this limit

• Annual limit is indexed for inflation starting after 2027

2. Employers

• Up to $2,500 per year per employee or dependent through an employer’s Trump Account contribution program

• Counts toward the $5,000 annual limit

• Not taxable income to the employee

3. Governmental entities & charities

May make qualified general contributions to groups of beneficiaries (not individual-specific gifts)

📊 How Must Trump Accounts Be Invested?

Funds in a Trump Account must be invested in:

• Mutual funds or ETFs that track the S&P 500, or

• Other indices composed primarily of U.S. equities

This structure is intended to promote long-term market-based growth.

🔒 Withdrawal Rules

Withdrawals are generally not allowed until January 1 of the year the child turns 18.

Once the child reaches that age:

• The account becomes a traditional IRA

• All standard traditional IRA rules apply (e.g., early withdrawal penalties, required minimum distributions later in life, etc.)

📄 New IRS Form 4547

A draft of Form 4547, Trump Account Election(s), is now available.

When finalized, this form will be used to:

• Elect to establish a Trump Account

• Enroll in the pilot program

🏛️ Guidance for Trustees & Financial Institutions

The notice provides preliminary rules for custodians and requests public comments on issues such as:

• Account administration

• Reporting requirements

• Rollover rules

• Coordination with existing IRA regulations

More details will be provided when the IRS publishes the full regulations.

📚 For More Information

The IRS continues updating resources related to the Working Families Tax Cuts Act.

You can monitor updates at:

• IRS.gov/trumpaccounts

• TrumpAccounts.gov

🧠 JUJU Accounting Insight

For families expecting a new child between 2025 and 2028, this may be a high-value early savings opportunity, especially with the $1,000 federal seed contribution.

For employers, this could become a powerful benefit program—similar to 529 employer match programs—but with retirement-style tax advantages.

As always, if you want to evaluate whether a Trump Account fits into your tax or long-term financial plan, we’re here to help you run the numbers and think strategically.

Hi friend,

The IRS just released the first wave of its “Get Ready” reminders—and although tax season may feel far away, the updates for 2026 are big enough that a little prep now will save a lot of time and stress later.

Here’s what you need to know:

🔍 1. What’s Changing in 2026?

The upcoming tax season will reflect major updates from the One, Big, Beautiful Bill, with several new deductions and tax-free categories that taxpayers will want to plan around.

Here are a few highlights the IRS and Treasury are actively implementing:

• No tax on tips

• No tax on overtime

• No tax on car loan interest

• New temporary deduction for seniors and others

More guidance is coming as the IRS releases official details, but these changes are significant—and they may impact your 2025 financial decisions before filing in 2026.

📁 2. Start Organizing Tax Records Now

The IRS stresses the importance of preparing early, and we echo that. Organized records = faster, more accurate filing and fewer refund delays.

Clients should begin collecting:

• Income documents

• Bank and investment statements

• Deduction and credit-related receipts

• Mileage and business-use logs

• Health coverage forms

• Any IRS notices from the year

Pro tip: Wait to file until you’ve received all required forms — even a single missing document can hold up your refund for months.

👤 3. Set Up Your IRS Online Account

If you don’t already have one, this is the time.

An IRS Online Account lets you:

• Access transcripts and prior returns

• View balances and payment history

• Manage payment plans

• Get digital copies of notices

• Update key personal information securely

The IRS continues to expand online services, making this tool invaluable for both taxpayers and professionals.

💸 4. Refund Checks Are Ending — Direct Deposit Required

The IRS began phasing out paper refund checks on September 30, 2025.

Which means:

✔️ Direct deposit will be the default (and fastest) refund method.

✔️ Clients should confirm their bank routing and account numbers ahead of time.

✔️ Anyone without a bank account should consider setting one up as early as possible.

If you want help verifying or updating your direct deposit info, we can walk you through it.

🧾 5. Final Thoughts

Preparing now—before the rush, before forms start flying in—gives you a major advantage.

The 2026 tax season will bring some of the most meaningful changes in years, and staying organized now means smoother filing later.

As always, JUJU Accounting is here to help you navigate new rules and stay ahead of any IRS updates.

Thanks to new IRS guidance and provisions in the One, Big, Beautiful Bill (PL119-21), millions of workers in tip-based industries may qualify for major new deductions — even if their employers don’t separately track tips on year-end tax forms.

Here’s what’s changing and what it means for you (or your clients & employees).

✨ “No Tax on Tips” — What It Actually Means

For tax years 2025 through 2028, eligible workers who receive qualified tips can deduct up to:

🟢 Up to $25,000 per year

This deduction is designed to reduce taxable income — not eliminate tip reporting requirements.

🟡 Who qualifies?

Workers who receive tips in a specified service trade or business, including:

• Restaurants

• Bars

• Hospitality

• Personal services (salons, spas, massage therapy, etc.)

• Any industry where tipping is customary

🔵 Income phaseout

Like many federal deductions, this one phases out at higher income levels:

• $150,000 MAGI for single filers

• $300,000 MAGI for joint filers

🔍 What about W-2s and 1099s?

IRS Notice 2025-69 confirms that:

• Employers do NOT need to change reporting systems.

• W-2s and 1099s stay the same for tax year 2025.

• Workers can calculate the deduction even if their employer does not separately track tips.

The IRS will update 2025 tax forms and instructions to help workers claim the deduction easily during filing season.

More than 6 million workers report tipped wages — and every one of them should be paying attention this year.

⏱️ Bonus: The “No Tax on Overtime” Deduction

A companion deduction also applies to qualified overtime compensation for 2025–2028.

Taxpayers may deduct the “half” portion of time-and-a-half pay — in other words, the amount earned above the regular hourly rate.

Overtime Deduction Limits

• $12,500 per year for single filers

• $25,000 per year for joint filers

• Same phaseout thresholds as the tip deduction

• Available for both standard deduction and itemized deduction filers

If you or your employees work overtime, this rule can reduce taxable income significantly.

📝 IRS Notice 2025-69 — What’s Inside

• Detailed examples of how to calculate the tip deduction

• Scenarios for tipped workers with irregular reporting

• Rules for workers receiving tips in transition years

• Clarification on what counts as “qualified” overtime

• Exemptions and edge cases practitioners should know

This year, tip earners and overtime earners will need more guidance than ever.

💬 Final Takeaway

The “No Tax on Tips” and “No Tax on Overtime” rules are some of the most impactful worker-focused tax benefits in years. Whether you’re a server, barber, bartender, hotel worker, or simply someone who logs a lot of overtime — your 2025 tax return may look very different.

JUJU Accounting will keep you updated as the IRS releases updated forms and instructions.

If you want help preparing for the 2026 filing season, we’re here, always ready to help.

The IRS has released the 2026 cost-of-living adjustments (COLA) for retirement plans — and the good news is that you can save more for retirement next year. Whether you’re contributing through a workplace plan, an IRA, or both, these new limits create valuable opportunities for tax planning and long-term wealth building.

📈 401(k), 403(b), 457, and TSP Limits Are Increasing

The annual employee contribution limit for workplace retirement plans will increase to:

👉 $24,500 for 2026 (up from $23,500 in 2025)

This applies to:

• Traditional & Roth 401(k) plans

• 403(b) plans

• Governmental 457(b) plans

• Federal Thrift Savings Plan (TSP)

💰 IRA Contribution Limits Rising

The annual contribution limit for IRAs increases to:

👉 $7,500 for 2026 (up from $7,000 in 2025)

🔺 IRA Catch-Up Contributions for Age 50+

Thanks to SECURE 2.0, the catch-up contribution is now indexed for inflation:

👉 $1,100 catch-up for 2026

Total possible contribution for age 50+: $8,600

-------------------------------

📊 2026 Income Phase-Out Ranges (Traditional IRA, Roth IRA & Saver’s Credit)

Taxpayers’ ability to deduct Traditional IRA contributions or contribute to Roth IRAs depends on income and filing status. All three sets of income phase-out ranges have increased for 2026.

🟦 Traditional IRA Deduction Phase-Outs (2026)

These apply only if you or your spouse is covered by a workplace retirement plan.

Single, covered by a workplace plan

👉 Phase-out: $81,000 – $91,000 (up from $79,000 – $89,000)

Married filing jointly — contributor covered by workplace plan

👉 Phase-out: $129,000 – $149,000 (up from $126,000 – $146,000)

MFJ — contributor not covered, but spouse is covered

👉 Phase-out: $242,000 – $252,000 (up from $236,000 – $246,000)

Married filing separately (covered by a workplace plan)

👉 Phase-out remains: $0 – $10,000 (unchanged)

If neither spouse is covered by a retirement plan at work, no phase-out applies — the full deduction is allowed regardless of income.

🟩 Roth IRA Contribution Phase-Outs (2026)

Single & Head of Household

👉 $153,000 – $168,000 (up from $150,000 – $165,000)

Married Filing Jointly

👉 $242,000 – $252,000 (up from $236,000 – $246,000)

Married Filing Separately

👉 Remains $0 – $10,000

🟪 Saver’s Credit Income Limits (2026)

Income limits for the Retirement Savings Contributions Credit (“Saver’s Credit”) also increased:

• Married filing jointly: up to $80,500 (2025: $79,000)

• Head of household: up to $60,375 (2025: $59,250)

• Single / Married filing separately: up to $40,250 (2025: $39,500)

🟧 SIMPLE Plan Updates for 2026

SIMPLE Contribution Limits

• Standard SIMPLE limit: $17,000 (up from $16,500)

• Higher limit for certain “applicable” SIMPLEs: $18,100 (up from $17,600)

Catch-Up Contributions (Age 50+)

• Most SIMPLE plans: $4,000 (up from $3,500)

• Certain applicable SIMPLE plans: $3,850 (unchanged)

Special SECURE 2.0 Catch-Up for Ages 60–63

• Higher catch-up (ages 60–63): $5,250 (unchanged)

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💡 What This Means for You

These 2026 changes create meaningful opportunities to:

• Reduce taxable income

• Maximize employer matching

• Build long-term retirement wealth

• Improve tax efficiency through IRAs or SIMPLE plans

• Take advantage of expanded eligibility for credits and deductions

If you’d like help optimizing your 2026 retirement strategy, contact JUJU Accounting!

🔗 Resource: Types of Retirement Plans

If you run payroll or work in a tipped or hourly profession, this update is for you.

The IRS has just announced penalty relief for employers and payors (guidance providing penalty relief) related to new information reporting requirements for cash tips and qualified overtime compensation under the One, Big, Beautiful Bill (OBBB) — for tax year 2025 only.

This relief is outlined in Notice 2025-62 and is designed to give businesses time to adjust their systems before stricter enforcement begins in 2026.

🧾 What This Means for Employers and Payors

For tax year 2025, the IRS will not impose penalties on employers and payors who:

• Fail to separately report cash tips or the occupation of the person receiving them, and/or

• Fail to separately report qualified overtime compensation,

👉 as long as the returns and payee statements are otherwise complete and correct.

The IRS recognizes that many employers don’t yet have systems in place to capture this new information — and that Forms W-2 and 1099 won’t be updated for 2025 to include these new OBBB-related fields.

So, consider 2025 your transition year to get ready.

💡 Recommended Best Practices

While not required to receive penalty relief, the IRS encourages employers and payors to start preparing:

• Track cash tips and overtime separately so employees can easily claim their new deductions.

• Provide employees access to this info through an online portal, written statement, or even Box 14 of Form W-2 for overtime.

• Begin updating payroll systems now to ensure compliance for 2026 and beyond.

This proactive step helps employees maximize their deductions — and helps businesses stay audit-ready when the transition period ends.

🧍‍♀️ For Employees and Tipped Workers

Good news: under the One, Big, Beautiful Bill,

• Qualified tips and qualified overtime pay may be deductible when reported properly.

• You’ll need detailed records from your employer or payor (such as your Form W-2, Form 1099, or Form 4137) to claim these deductions on your 2025 tax return.

• Keep an eye out for future IRS guidance on how individuals can claim these new deductions.

🗓️ Key Takeaway

✅ No penalties for 2025 if you’re otherwise filing correctly.

✅ 2025 = transition year to prepare for full compliance.

✅ Start tracking tips and overtime now to make tax time smoother next year.

📚 Official Source:

Read more on the IRS One, Big, Beautiful Bill provisions page →

If you have any questions or need assistance with claiming the new deductions or staying compliant with the updated filing requirements, contact JUJU Accounting!

Heads up — New Phishing Alert!

The IRS, state tax agencies, and the nation’s tax industry (known together as the Security Summit) are warning tax professionals about a new wave of phishing emails designed to steal Electronic Filing Identification Numbers (EFINs) and sensitive client data.

These scam emails pretend to be from the IRS and say things like:

“We have identified returns filed under your Electronic Filing Identification Number (EFIN) that require review.”

They then instruct recipients to download an “IRS Transcript Summary of Data (SOD) Viewer.”

🚫 Don’t do it. This download contains malware that can compromise your systems and allow identity thieves to access client data.

🔐 How to Stay Safe:

• Never click on links or download files from unexpected or suspicious emails.

• Don’t send EFIN or sensitive documents via email or fax unless you’ve verified the requester’s identity through official contact channels.

• Report phishing attempts to phishing@irs.gov — include the full email and header.

• Notify TIGTA if the email impersonates the IRS.

• Contact your local IRS Stakeholder Liaison right away if you suspect a data breach or system compromise.

📚 Helpful Resources:

• Tax Pros: EFIN scams don’t sleep (IRS Tax Tip 2025-57)

• IRS warns tax professionals to be aware of EFIN scam email (2024 release)

• Protect Your Clients; Protect Yourself – IRS Campaign Page

At JUJU Accounting, we take cybersecurity seriously — protecting your clients starts with protecting your systems.

Stay alert, stay skeptical, and when in doubt, verify before you click.

The Treasury Department and IRS have just released Notice 2025-50, offering new guidance for Qualified Opportunity Zone (QOZ) investments in rural areas under the One, Big, Beautiful Bill (OBBB).

This update makes it easier for investors to bring new life to underserved rural communities — and enjoy stronger tax incentives while doing it.

🌾 What’s New for Rural Opportunity Zones

Two key updates stand out:

• New “Rural Area” Definition

A rural area now means any location outside a city or town with a population greater than 50,000, including nearby urbanized areas.

✅ Applies across all U.S. states, D.C., and territories.

• Reduced Substantial Improvement Threshold

For properties located entirely within rural QOZs, the substantial improvement requirement is cut in half — from 100% to 50%.

🔹 Effective July 4, 2025

🔹 Applies to tangible property that is newly acquired or improved in these zones

These updates are designed to make rural investments more attractive, helping bridge the economic gap and support long-term community development.

📊 The Bigger Picture

• There are 8,764 total QOZs in the U.S.

• 3,309 zones are now identified as entirely rural.

These regions have historically struggled to attract sustained investment — a gap this new guidance aims to close.

🧭 What This Means for You

If you or your clients are looking to:

✅ Invest in real estate or businesses in rural areas

✅ Defer or reduce capital gains taxes through QOZ investments

✅ Support local economic growth while securing long-term tax benefits

Now may be the time to explore these new opportunities.

📘 Additional Resources

• Notice 2025-50 – Full IRS Guidance

• Notice 2018-48 – List of all designated Opportunity Zones

The Treasury and IRS also plan to release future guidance on the next round of opportunity zones under the OBBB, including new nomination and designation procedures.

At JUJU Accounting, we help investors and business owners identify, plan, and structure QOZ investments for maximum tax efficiency and community impact.

👉 Have questions about Opportunity Zone tax benefits or rural investment planning? Contact us!

When dealing with the IRS, you’re not alone — and you don’t have to go it alone.

By law, every taxpayer has the right to retain representation when communicating or meeting with the IRS. This right is part of the Taxpayer Bill of Rights, a set of ten core protections every taxpayer should know.

⚖️ Your Right to Representation — What It Means

Here’s what this important right allows you to do:

• Choose your representative. You may appoint an attorney, CPA, enrolled agent, or other qualified individual to represent you before the IRS.

• Skip the meeting if represented. If you have authorized representation, you generally don’t have to attend an IRS interview yourself — unless the IRS issues a formal summons.

• Pause for advice. If you’re being interviewed and want to consult your representative, the IRS must suspend the interview to give you that chance.

• File a power of attorney. Your representative can formally step in by submitting a written Power of Attorney (Form 2848) to act on your behalf.

💡 If You Can’t Afford Representation

You still have options. The Low Income Taxpayer Clinics (LITCs) provide free or low-cost assistance to taxpayers who meet certain income guidelines.

These clinics:

• Help with audits, appeals, and tax collection disputes.

• Can represent you before the IRS and in court.

• Offer education on taxpayer rights and responsibilities — often in multiple languages for English learners.

You can find a local LITC at IRS.gov/LITC or by calling 800-829-3676.

🧭 JUJU Accounting Insight

At JUJU Accounting, we strongly believe that understanding your rights is the first step to confident tax management. Whether you need representation, audit defense, or simply want to stay informed, our team is here to help ensure your voice is heard and your rights are protected.

Stay informed. Stay empowered.

Good news for employers looking to expand their teams — the Work Opportunity Tax Credit (WOTC) remains available through December 31, 2025.

The WOTC is a federal tax credit designed to encourage businesses to hire individuals who face barriers to employment, such as veterans, long-term unemployed workers, and individuals receiving government assistance.

To claim the credit, employers must first certify the employee’s eligibility through their state workforce agency (SWA) — not the IRS.

Here’s how:

• Complete IRS Form 8850, Pre-Screening Notice and Certification Request for the Work Opportunity Credit.

• Submit the form to your state workforce agency within 28 days of the eligible employee’s start date.

• Wait for certification before claiming the credit on your business tax return.

This credit can reduce your tax liability while helping create opportunities for those who need them most — a true win-win.

📄 Tip: For more details, review IRS Tax Tip resources or contact JUJU Accounting.

The IRS and Treasury Department have released proposed guidance under the One Big, Beautiful Bill clarifying which types of jobs may customarily and regularly receive tips — and therefore qualify for the new “no tax on tips”provision.

🧾 What’s New?

The proposed list includes nearly 70 occupations, ranging from bartenders and baristas to water-taxi operators and hotel valets. If finalized, this could mark a major shift for millions of workers who depend on tips as a significant part of their income.

💡 Who Qualifies?

To claim the new tip deduction, workers must receive qualified tips, meaning:

• The tip is voluntary (not mandatory or auto-added).

• It’s paid in cash or equivalent (like digital payment).

• It’s not part of an automatic service charge customers can’t opt out of.

🗓️ Have an Opinion? Speak Up!

The IRS is inviting public comments on these proposed rules until October 23, 2025. This is your chance to share feedback before the regulations are finalized.

👉 Instructions for submitting comments are available in the official proposed regulations.

------------

At JUJU Accounting, we’re keeping a close eye on how this change may impact service industry workers and small business owners.

Whether you run a café, salon, or tour company — understanding these rules early can help you plan smarter for tax season.

💬 Need help interpreting how this might affect your business or employees?

We’re here to help. Contact JUJU Accounting!

The IRS has announced a major change: paper tax refund checks for individual taxpayers will begin to be phased out starting September 30, 2025. This move, required under Executive Order 14247, is part of the federal government’s broader transition toward secure electronic payments.

Why this matters

• Safer refunds: Paper checks are 16x more likely to be lost, stolen, or delayed compared to direct deposit.

• Faster access: With e-filing + direct deposit, refunds typically arrive within 21 days. Paper checks can take six weeks or more.

• Lower costs: Electronic payments reduce government costs and inefficiencies.

What stays the same

• Filing process unchanged: Keep filing your returns as usual, using your preferred method.

• Refunds go digital: Expect direct deposit or other electronic methods instead of mailed checks.

Options for taxpayers without bank accounts

The IRS will offer secure alternatives such as prepaid debit cards, digital wallets, or limited exceptions. If you don’t currently have a bank account, now is the time to set one up. Helpful resources:

• FDIC: GetBanked

• MyCreditUnion.gov

The bigger picture

• During the 2025 filing season, 93% of all refunds were already issued by direct deposit. Only 7% of taxpayers received a paper check.

• This transition aligns refunds with the way most Americans already get paid.

• The change also applies to payments made to the IRS, but for now, existing payment options remain in place.

What to do now

✔ Make sure your banking information is accurate with the IRS.

✔ If you don’t have an account, consider opening one before the 2026 filing season.

✔ Stay tuned — the IRS will release detailed guidance before the next tax year begins.

For more details, visit: IRS.gov/modernpayments

👉 At JUJU Accounting, we’ll continue to keep you updated on how these changes affect your tax filings and refund options. As always, our team is here to help you prepare, plan, and stay ahead.

Whether you sell custom t-shirts, restore vintage furniture, or stream your chess games online, the IRS wants to know: is it a business—or just a hobby?

The difference matters—a lot—especially at tax time. Business activities are typically eligible for deductions and are taxed differently than hobbies. Here’s how to think it through.

🧩 The Key Difference

The IRS draws a clear line:

• A business is run to make a profit.

• A hobby is done for fun, pleasure, or recreation—even if it happens to bring in some money.

If you’re selling things or getting paid through apps like Venmo, PayPal, or Cash App, you may receive a Form 1099-K for your transactions. That income is taxable either way—but how you report it depends on whether it’s a business or a hobby.

🧠 Ask Yourself These Questions

No single factor decides your status. Instead, consider all the following:

✅ Are you trying to make a profit?

✅ Do you depend on the income to support yourself?

✅ Have you made a profit—if so, how much and how often?

✅ Are you improving operations to be more profitable?

✅ Do you keep good books and treat it like a real business?

✅ Do you (or your advisors) have the knowledge to succeed in this field?

✅ Are losses normal for the startup phase—or due to outside factors?

If most answers point toward a for-profit mindset and structured operation, you’re likely running a business. If not, it may still be considered a hobby—no shame in that!

💡 Tip: Good Records Matter Either Way

Keep track of income, expenses, and receipts, even if you're unsure.

📚 Resources to Explore

• Small Business and Self-Employed Tax Center

• IRS Publication 535 – Business Expenses

• IRS Publication 334 – Tax Guide for Small Business

• Activities Not Engaged in for Profit Audit Technique Guide

• What to Do With Form 1099-K

Need help deciding?

If you’re unsure where you land—contact us! It’s easier (and cheaper) to get clarity now than to correct things later.

Hi Friend!

If you’re a business providing childcare support to your employees, the IRS has a generous incentive for you: the Employer-Provided Childcare Tax Credit, worth up to $150,000 per year.

Here’s what you need to know to take advantage of this underutilized credit.

💡 What is the Employer-Provided Childcare Tax Credit?

This credit helps businesses offset the costs of offering or supporting childcare services for employees. It’s designed to ease the financial burden of:

• Running or building a qualified childcare facility

• Offering resource and referral services to help employees find childcare

💰 How Much Is It Worth?

Your business could claim up to $150,000 annually, broken down as:

• 25% of qualified childcare facility expenses

• 10% of qualified resource and referral costs

✅ Who’s Eligible?

Any business that pays or incurs qualified childcare costs during the tax year can apply. These qualified expenses include:

• Building, acquiring, or expanding a licensed childcare facility

• Day-to-day operating costs

• Scholarships or training for childcare workers

• Referral contracts with qualified childcare facilities

• The childcare facility must meet all state and local regulations to be considered “qualified”.

📄 How to Claim the Credit

• File IRS Form 8882 – Credit for Employer-Provided Childcare Facilities and Services

• Attach to your tax return as part of your general business credit

• Carryback unused credits 1 year and carryforward for up to 20 years

• If you only receive the credit from a pass-through entity, report it directly on Form 3800

🔗 Learn More

Visit the IRS Employer-Provided Childcare Credit page to dive into eligibility requirements and filing instructions.

Supporting childcare is good for business, good for families — and now, great for your tax bill. Don’t leave this credit on the table!

⏱️ Starting in 2025, thanks to the One Big Beautiful Bill Act (Public Law 119-21), workers who earn overtime can now enjoy a brand-new tax deduction.

📌 What’s Covered?

• You can deduct the extra pay above your regular rate - such as the “half” portion of the time-and-a-half compensation - that is required by the Fair Labor Standards Act (FLSA).

• Applies to income reported on Form W-2, Form 1099, or similar statements.

• Deduction is available for both itemizers and non-itemizers.

💸 Deduction Limits

• Up to $12,500 for single filers.

• Up to $25,000 for joint filers.

• Phases out once your modified AGI exceeds:

• $150,000 (single)

• $300,000 (joint)

✅ Eligibility Requirements

• Must include your Social Security Number on your return.

• Married taxpayers must file jointly to claim the deduction.

📝 Reporting Rules

• Employers and payors are now required to report total qualified overtime compensation to the IRS (or SSA) and provide statements to employees.

• The IRS will grant transition relief in 2025 for both workers and employers as everyone adjusts to the new reporting requirements.

⸻

🚀 Bottom line: If you’re putting in extra hours, Uncle Sam just gave you a break. Overtime pay will now stretch further — and that’s money back in your pocket.

👩‍💼 Need help making sure you qualify and maximize your deduction? Contact JUJU Accounting.

Hi Friend,

If you filed an extension for your 2024 individual federal taxes, you don’t have to wait until the October 15 deadline to file. The IRS still offers free ways to file — and we’re breaking them down for you here.

💸 IRS Free File (for incomes $84,000 or less)

If you made $84,000 or less in 2024, you can use IRS Free File to prepare and e-file your federal return online — totally free.

This option uses guided tax prep software to help you claim valuable credits like:

✅ The Earned Income Tax Credit

✅ The Child and Dependent Care Credit

➡️ Start Free Filing at IRS.gov/freefile »

✍️ Free File Fillable Forms (for the confident DIYers)

No income limit here! But this is best for people who are comfortable preparing their own returns. You fill out the electronic forms manually — no guided help.

Think of it as the IRS version of filling out your own 1040 on screen.

🎖️ MilTax (for military and families)

Active duty military members and certain veterans qualify for MilTax, a free filing program provided by the Department of Defense.

It includes:

1 federal return

Up to 3 state returns

➡️ Check MilTax eligibility »

📲 Other E-Filing Options

You can also use commercial tax software to e-file through IRS-authorized channels. Your return will be checked for math mistakes or missing info before it’s accepted.

Need help? Use the IRS e-File Provider Database to find a qualified pro near you:

➡️ Search IRS e-file Providers »

⚠️ Disaster Area? You May Have Extra Time

If you live in a federally declared disaster area, you may automatically get more time to file.

➡️ Check for current tax relief info »

Just because you have until October 15 doesn’t mean you should wait. The sooner you file, the sooner you can fix any issues and receive your refund (if you're getting one)!

As always, if you're stuck — contact us! 💬

Tax season may come and go, but identity thieves work year-round. As scammers get sneakier, it’s more important than ever to know how the real IRS reaches out—and how to spot a scam in disguise.

Here’s what every taxpayer should know:

🚫 What the IRS Will Not Do

The IRS will never make initial contact with you through:

• 📧 Email

• 📱 Text messages

• 💬 Social media messages

Those are all red flags 🚩. Common scams include:

• Phishing emails pretending to be about a refund or bill

• Fake IRS social media profiles messaging about “stimulus” or “tax credits”

• Texts with urgent calls to action and suspicious links

🔒 Reminder: The IRS only sends texts or emails if you opted in—and only for things you subscribed to.

📬 What the IRS Will Do First

The IRS starts with a letter or notice by mail.

To check if a letter is legit:

• Log in to your IRS Online Account to see if the letter is there

• Compare it to official letters at Understanding Your IRS Notice or Letter

• Call the IRS directly to verify

💡 Got a notice from a private collection agency? It should match your official IRS CP40 notice and have the same Taxpayer Authentication Number.

📞 What About Phone Calls?

Yes, the IRS may call after sending a letter, for things like:

• Confirming appointments

• Discussing a scheduled audit

But they won’t:

• Leave pre-recorded or threatening voicemails

• Claim you’ll be arrested if you don’t call back

• Demand payment via gift cards, Venmo, or prepaid cards

Only use the IRS’s official payment options to pay any tax bills.

🚷 What About Home Visits?

The IRS has ended most unannounced home visits to protect both you and IRS employees. If someone shows up claiming to be from the IRS, that’s already suspicious.

🧠 Stay Informed and Stay Safe

If you think you’ve been targeted:

• Visit the IRS page on reporting phishing and scams

• Browse the latest IRS consumer alerts

• Learn about IRS-authorized Private Debt Collection Frequently Asked Questions

If you’re ever unsure, don’t engage. Just ask us—or check directly on IRS.gov. It’s always better to be cautious than to fall for a clever scam.

Tax-related identity theft is still one of the fastest-growing types of financial fraud — but there’s a simple, powerful step you can take to protect yourself: set up an IRS Online Account and request an Identity Protection PIN (IP PIN).

Here’s why it matters — and how to get started.

✅ What is an IP PIN?

An Identity Protection PIN is a unique six-digit number issued by the IRS to verify your identity when you file your federal tax return. It adds an extra layer of security, even if you’re not required to file or you live outside the U.S.

Once issued, only you and the IRS know your IP PIN. Even if someone has your Social Security Number or ITIN, they can’t file a valid tax return without your IP PIN.

📌 Key Things to Know

• Anyone with an SSN or ITIN can get one — including U.S. citizens living abroad.

• You must verify your identity to receive one.

• Tax pros can’t get it for you — but they can use it once you provide it.

• A new IP PIN is issued every year.

• You’ll need to use your IP PIN for all federal tax returns during the year — including late or amended filings.

• It’s voluntary, but strongly encouraged for added protection.

• The IRS will never contact you to ask for your IP PIN. Don’t fall for phishing calls, emails, or texts!

🧾 How to Request an IP PIN

Fastest way:

• Log in to your IRS Online Account at IRS.gov.

• Go to the “Profile” page and select “Get an IP PIN.”

• If you don’t have an online account, follow the prompts to register and verify your identity.

Can’t verify online?

If you're unable to verify your identity digitally:

• File Form 15227 if your income (your adjusted gross income on your last filed return) is under $84,000 (individual) or $168,000 (married filing jointly).

• Or, make an appointment at a Taxpayer Assistance Center.

🎯 For Tax Pros and Victims of Fraud

If you’ve been affected by identity theft in the past, an IP PIN can help prevent repeat fraud. Tax professionals should recommend this tool to clients who’ve had their info misused — even if a fraudulent return has already been filed.

🔐 Want to Learn More?

Explore these IRS resources:

• Identity Theft Central

• Publication 5293: Data Security Resource Guide for Tax Pros

Stay one step ahead of fraudsters.

Set up your IRS Online Account and protect your identity with an IP PIN today.

📬 Have questions? Contact us — we’re here to help.

If you filed an extension for your individual or C Corporation federal tax return earlier this year, your new deadline is Wednesday, October 15, 2025. If you already have your documents ready, there’s no reason to wait—filing now can help you avoid last-minute stress.

Here are a few key reminders to make sure you're on track:

✅ File by October 15

E-file your return and select direct deposit for your refund—it's the fastest and safest way to get your money.

🌀 In a disaster area? You might have more time to file. Check the IRS disaster relief page for updates.

💻 Free Filing Help Still Available

If your income is $84,000 or less, you can file for free using IRS Free File on IRS.gov. The deadline is also October 15, 2025.

Need in-person help? Free basic tax prep may still be available if you qualify for:

• The Earned Income Tax Credit (EITC)

• Disability-related assistance

• Limited English-speaking support

Check for VITA or TCE locations near you.

💳 Payment Options if You Owe

If you owe taxes but can’t pay in full, don’t wait. Pay as much as you can now to reduce penalties and interest. You can:

• Apply for a payment plan online

• View your balance and payment options through your IRS account

Start here: View your account at IRS.gov

🤝 Tax Pros Are Here to Help

Feeling overwhelmed? JUJU Accounting is here to help. Reach out anytime for assistance.

If you or someone you love is living with a disability, there’s good news: ABLE (Achieving a Better Life Experience) accounts can help you save for disability-related expenses without affecting eligibility for essential government benefits like Medicaid or SSI.

💡 What’s an ABLE Account?

An ABLE account is a tax-advantaged savings account for individuals who became disabled before age 26. These accounts are specifically designed to help cover qualified disability-related expenses – like education, housing, assistive technology, or transportation – without jeopardizing access to programs you rely on.

Tax perks: While contributions aren’t deductible for federal taxes, earnings and distributions are tax-free when used for qualified expenses.

2025 contribution limit: Up to $19,000 can be contributed annually.

Additional contributions: If you’re employed, you may be able to contribute even more – up to:

• $15,650 in the continental U.S.

• $19,550 in Alaska

• $17,990 in Hawaii

🎁 Extra Savings Boost: The Saver’s Credit

If you contribute to your own ABLE account, you might qualify for the Saver’s Credit, which can reduce the amount of tax you owe (or increase your refund). You must:

• Be 18 or older by year-end

• Not be claimed as a dependent or a full-time student

• Meet income limits

You’ll need to file Form 8880 to claim this valuable non-refundable credit.

🔁 What About 529 Plan Rollovers?

Families with leftover funds in a 529 education savings account can roll over those funds to an ABLE account, as long as:

• The ABLE account belongs to the same person or a qualified family member, and

• The rollover doesn’t exceed the yearly contribution limit

Example: If the annual ABLE contribution limit is $19,000 and you roll over $8,000 from a 529 plan, you can still contribute $11,000 for that year.

✅ What Can You Pay For?

Qualified disability expenses include things like:

• Education and training

• Healthcare and personal support services

• Transportation

• Housing

• Employment support

Check Publication 907 for a full list of eligible uses.

🧾 Important Forms to Know

Form 1099-QA: Shows ABLE distributions

Form 5498-QA: Shows ABLE contributions

Use these when filing your taxes to report or track account activity

ABLE accounts offer a powerful and flexible way to save for disability-related needs—with no risk to your benefits and with possible tax savings through the Saver’s Credit.

Need help deciding if an ABLE account is right for you? Contact us!

What’s better than a great deal? A tax-free one.

Sales tax holidays are back for 2025, and if you know when and where to shop, you can save serious money—especially on back-to-school items, tech, clothing, and even emergency supplies.

🗓️ What Is a Sales Tax Holiday?

A sales tax holiday is a short period when certain items are exempt from state sales tax—typically a weekend, but some states extend the savings for a week or more. These holidays are most common in July and August, right in time for back-to-school shopping, but some states also offer tax-free savings on items like energy-efficient appliances, hurricane-preparedness supplies, and hunting gear.

⚠️ Heads up: Not every state has a sales tax holiday. And even if your state waives its sales tax, local taxes may still apply. Check your local rules before you head to the store!

🛒 2025 Tax-Free Weekends by State

State   Dates Eligible items / Maximum cost per item

________________________________________________________________

 Alabama July 18-20   - Clothing / $100

 - Computers / $750 

 - School supplies / $50 

 - Books / $30 

_________________________________________________________________

Arkansas Aug. 2-3 - Clothing and footwear / Less than $100 

 - Accessories / Less than $50 

 - School supplies / No maximum

_________________________________________________________________

Connecticut     Aug. 17-23 Clothing and footwear / Less than $100

_________________________________________________________________

Florida   Aug. 1-31 - School supplies / $50 

 - Clothing, footwear and accessories / $100 

 - Computers and accessories / $1,500 

 - Learning aids and jigsaw puzzles / $30

  Sept. 8-Dec. 31     Tools / Varying maximums

__________________________________________________________________

Iowa Aug. 1-2 Clothing and footwear / Less than $100

__________________________________________________________________

Maryland Aug. 10-16 - Clothing and footwear / $100 

- Backpacks / First $40 

__________________________________________________________________

Massachusetts Aug. 9-10 All retail items for personal use (except vehicles, food, alcohol, 

 gas, certain utilities, tobacco, marijuana) / $2,500

___________________________________________________________________

Mississippi July 11-13   - Clothing and footwear / Less than $100 

 - Select school supplies / Less than $100 

   Aug. 29-31   Firearms, ammunition and hunting supplies / No maximum

____________________________________________________________________

Missouri Aug. 1-3 - Clothing / $100 

- School supplies / $50 

- Computers and peripheral devices / $1,500 

- Computer software / $350 

- Graphing calculators / $150 

_____________________________________________________________________

Nevada Oct. 31-Nov. 2 Purchases by National Guard members or qualifying relatives / No maximum

_____________________________________________________________________

New Mexico July 25-27 - Clothing / Less than $100 

- Computers / $1,000 

 - Computer equipment / $500 

 - Certain school supplies / Less than $30 

______________________________________________________________________

Ohio Aug. 1-14 All tangible personal property (except certain watercrafts or outboard 

motors, motor vehicles, alcohol, tobacco, vapor products, marijuana) / $500

______________________________________________________________________

Oklahoma Aug. 1-3 Clothing and footwear / Less than $100

______________________________________________________________________

South Carolina Aug. 1-3 Items include computers, school supplies and clothing / No maximum

______________________________________________________________________ 

Tennessee July 25-27 - Clothing / $100 

 - School supplies / $100 

 - Computers and tablets / $1,500 

______________________________________________________________________

Texas Aug. 8-10 Clothing, backpacks and school supplies / Less than $100

______________________________________________________________________ 

Virginia Aug. 1-3 - Clothing / $100 

 - School supplies / $20 

 - Energy Star and WaterSense products / $2,500 

 - Hurricane-preparedness items / $60 

 - Generators / $1,000 

______________________________________________________________________

West Virginia Aug. 1-4 - Clothing / $125 

- School supplies / $50 

- School instruction material / $20 

- Sports equipment / $150 

- Computers and tablets / $500

______________________________________________________________________

👉 Want the full list? Visit your state’s tax department website or search “2025 sales tax holiday [your state]” for the official breakdown.

💡 Pro Tips for Maximum Savings

1. Time Big Purchases Right

Need a new laptop or school clothes? Shop during your state’s tax-free weekend to avoid paying extra. Items often have price limits (e.g., clothes must be under $100), so check before you buy.

2. Know What Counts (and What Doesn’t)

Not everything qualifies. For example, New Mexico excludes sports uniforms and bathing suits from its tax holiday. Always check your state’s fine print.

3. Stack Your Savings

Use coupons, promo codes, and price comparison tools to lower your total even more. Tax-free is great—but combined with a deal? Even better.

4. Look Beyond Back-to-School

Sales tax holidays aren’t just for students. Some states offer them for emergency supplies, energy-saving appliances, and hunting gear—perfect for prepping ahead.

📌 Bottom Line

Sales tax holidays offer a limited-time chance to save, so mark your calendar, plan your purchases, and don’t miss out. Whether you’re stocking up for school or snagging a new computer, every dollar counts—especially when you can skip the tax.

Need help with tax planning or bookkeeping?

Contact us today for expert support. 

Part of the IRS “Protect Your Clients; Protect Yourself” Summer Security Series

Tax scams are evolving—and fast. In Week 2 of the IRS’s “Protect Your Clients; Protect Yourself” campaign, the IRS and Security Summit partners are sounding the alarm on phishing attacks and related cyber threats that specifically target tax professionals like us.

🔍 What’s Happening?

Cybercriminals are getting smarter—sending convincing emails and texts that look legit, but are designed to steal sensitive client data, install malware, or gain access to your systems. Whether it's a fake IRS email or a phony “new client” inquiry, one wrong click can lead to a major data breach.

⚠️ Common Tax Scam Tactics

• Phishing/Smishing:

Mass emails or texts with malicious links or attachments. Often appear to be from IRS, banks, or tax software providers.

• Spear Phishing:

Aimed at specific individuals using personal details to build trust and credibility.

• Clone Phishing:

A real email gets duplicated with dangerous links or infected attachments.

• Whaling:

Targets high-level individuals like firm owners, payroll managers, or financial officers.

• New Client Scam:

Scammers pose as potential clients to trick pros into opening dangerous links or files.

🚨 Red Flags to Watch For

• Emails with a sense of urgency: "Act now or lose access!"

• Links or email addresses with slight misspellings (like IRS.com instead of IRS.gov).

• Attachments from someone you weren’t expecting, even if the sender looks familiar.

• Duplicate messages from a known contact—but with new links or requests.

🛡️ 6 Easy Steps to Strengthen Your Cybersecurity

The “Security Six” is a simple checklist all tax pros should follow:

• Install & Update Antivirus Software

• Use a Strong Firewall

• Enable Multi-Factor Authentication

• Back Up Data Regularly

• Encrypt Your Drives

• Use a Secure VPN When Working Remotely

📣 If You’ve Been Targeted or Compromised

• Contact your IRS Stakeholder Liaison

• Notify your state tax agency via the Federation of Tax Administrators breach page

📚 Additional IRS Security Resources for Tax Pros

• Publication 4557: Safeguarding Taxpayer Data (https://www.irs.gov/pub/irs-pdf/p4557.pdf)

• Publication 5293: Data Security Resource Guide (https://www.irs.gov/pub/irs-pdf/p5293.pdf)

• Publication 5708 & 5709: Written Information Security Plans (Publication 5708: https://www.irs.gov/pub/irs-pdf/p5708.pdf ; Publication 5709: https://www.irs.gov/pub/irs-pdf/p5709.pdf)

• IRS Identity Theft Info Center (https://www.irs.gov/identity-theft-central)

Stay safe and stay sharp!

Summer is in full swing—and while it’s a season for weddings, travel, home upgrades, and side gigs, many of these activities also come with tax implications. A little awareness now can mean a smoother tax season later. Here are some ways your summer fun might affect your next tax return:

Just Married? Make It Tax Official

If you recently tied the knot, congrats! A few quick updates now can prevent tax-time hassles:

• Report name changes to the Social Security Administration.

• Moved? File IRS Form 8822 and update your address with USPS and your employer.

Summer Day Camp = Possible Tax Credit

Sending your kids to summer day camp? You may be eligible for the Child and Dependent Care Credit.

Traveling for Business? Keep Your Records Tight

• Keep detailed records of dates, purpose, and expenses.

• Only the business portion of the trip is deductible—vacation days don’t count.

Part-Time or Gig Work? File Even If You Don’t Owe

Summer jobs, side hustles, and freelance gigs may not always result in a big tax bill—but you could still be owed a refund. File to claim it!

Earning via payment apps? You might get a 1099-K.

Learn more at the IRS Gig Economy Tax Center (https://www.irs.gov/businesses/gig-economy-tax-center).

Home Upgrades That Can Lower Your Tax Bill

• Up to $3,200 in Energy Efficient Home Improvement Credits for eligible items like windows, doors, HVAC, or water heaters.

• Residential Clean Energy Credits for solar panels, battery storage, geothermal, and more.

• Check eligibility at the IRS Home Energy Tax Credits page (https://www.irs.gov/credits-deductions/home-energy-tax-credits) and save your receipts.

Pro Tip: Document Now, Relax Later

Whether it’s a new address, a summer job, or a solar panel install—keep records! A bit of tracking now can lead to bigger refunds or smaller headaches next tax season.

If you have questions about how your summer activities could affect your taxes, we’re here to help. Reach out anytime!

Congress has officially passed the One Big Beautiful Bill, a sweeping package that reshapes U.S. tax law, locks in most of the 2017 Tax Cuts and Jobs Act (TCJA), and introduces major new individual and business tax provisions starting in 2025. It also impacts student loans, Pell Grants, the debt ceiling, and more.

Whether you're a tipped worker, a small business owner, or a tax strategist, this bill will likely affect you. Let’s break it all down.

🧾 What’s Changing — and When

🔹 For Individuals:

🔄 Starting Tax Year 2025 (filed in 2026):

1. No federal tax on tips and overtime

⤷ Up to $25,000 of tip income and $12,500 (single) / $25,000 (joint) of overtime pay is tax-free through 2028, with income phaseouts.

2. Senior deduction: $6,000 per qualifying senior (2025–2028), phases out at $75,000 AGI.

3. Child Tax Credit increased to $2,200 starting in 2026, indexed for inflation.

4. Adoption credit becomes partially refundable.

5. Standard deduction boost:

• $31,500 (joint)

• $23,625 (head of household)

• $15,750 (single) — all inflation-adjusted after 2025.

6. SALT deduction cap increases to $40,000 in 2025, rising 1% annually through 2029; phases out above $500,000 AGI, drops back to $10,000 after.

7. EV auto loan interest deduction: Up to $10,000 on U.S.-assembled vehicles, 2025–2028, phased out at $100k/$200k AGI.

8. Above-the-line charitable deduction: $1,000 ($2,000 joint) permanently.

9. 0.5% floor on itemized charitable deductions.

10. Trump Savings Accounts for children: details still pending, but expected 2025–2028.

11. IRA phaseouts and other thresholds adjust for inflation.

12. AMT exemption increases and remains indexed to inflation (but AMT phaseout thresholds revert to 2018 levels).

13. Earned Income Tax Credit - The maximum credit for filing jointly as a married couple and claiming three or more qualifying dependents amounts to $8,046 in 2025, with the credit completely phased out at $68,675 of adjusted gross income (AGI). If you are a Single filer with no dependents, you can receive a maximum credit of $649 with your phaseout beginning at $19,104 of AGI.

14. EV credit ends September 30, 2025.

🔄 From 2026 Forward (Permanent unless otherwise noted):

15. TCJA tax brackets locked in (10%, 12%, 22%, 24%, etc.) with additional 1-year inflation adjustment for lower brackets.

16. No personal exemptions (permanently repealed).

17. Increased standard deductions (indexed for inflation)

18. Increased Child Tax Credit (indexed for inflation)

19. $750,000 principal limit mortgage interest cap stays permanent.

20. Cap on itemized deductions limited to 35 cents per dollar for top bracket filers.

21. Itemized deductions eliminated or limited:

• Personal casualty losses

• Miscellaneous deductions (except teacher expenses)

• Moving expenses (except for military/intel)

22. Estate and lifetime gift tax exemption raised permanently to $15M single / $30M joint, indexed.

🔹 For Businesses:

🔄 Starting Tax Year 2025:

1. Bonus depreciation: 100% restored permanently.

2. R&D expensing: Immediate write-off restored permanently.

⤷ Small businesses can retroactively expense R&D back to 12/31/21.

3. EBITDA-based interest deduction limit returns permanently.

4. Section 179: Expensing cap expands to $2.5M (phased out at $4M+), inflation-adjusted.

5. 100% expensing for qualifying structures built between 1/19/25 and 1/19/29, in service by 1/1/31.

🔄 From 2026 Forward (Permanent unless otherwise noted):

6. QBI deduction (Section 199A) stays — 20% for pass-throughs, with expanded eligibility and a $400 minimum deduction.

7. 1099-K threshold raised to $10,000 — fewer gig workers will receive the form.

8. New 1% deduction floor on corporate charitable contributions.

💡 Green Tax Credit Changes:

1. EV & residential energy credits repealed after 2025.

2. Clean hydrogen, building efficiency, and solar/wind credits phased out or narrowed by 2027.

3. Clean fuel credit (45Z) extended to 2030 and expanded.

4. New FEOC (Foreign Entity of Concern) restrictions apply to multiple energy credits.

🌐 International Tax Reform

1. GILTI renamed to Net CFC Tested Income (NCTI), taxed at 12.6%–14%.

2. FDII renamed to Foreign-Derived Deduction Eligible Income (FDDEI), taxed at 14%.

3. BEAT rate raised to 10.5%.

4. Indirect expense allocations removed, and foreign tax creditability rises to 90%.

📌 What Didn’t Change

1. Inflation adjustments to brackets and deductions remain automatic.

2. IRA contribution limits unchanged for 2025.

3. AMT structure still protects middle-income households.

4. No changes to payroll tax or Social Security contributions.

📅 Smart Planning Moves You Can Make Now

Individuals:

1. Tipped workers: Adjust W-4s to reflect tax-free tips in 2025.

2. High-income households: Time SALT payments strategically.

3. Seniors: Stack medical expenses in 2025 to pair with the $6,000 deduction.

4. EV buyers: Buy before September 30, 2025 to claim the final EV credit.

Businesses:

1. CapEx ahead: Plan large purchases for 2025 to use 100% bonus depreciation.

2. Manufacturers: Design facility expansions to qualify for temporary 100% structure expensing.

3. R&D-heavy startups: Retroactively claim past R&D expenses starting immediately.

4. 1099-K reporters: Update internal systems for new $10k reporting threshold.

❓ Frequently Asked Questions

1. Does the tip/overtime exclusion last forever?

No, it expires after 2028 unless extended.

2. Is the SALT cap removed?

No — just temporarily raised and phased out for high earners.

3. Can I still claim an EV credit in 2025?

Yes, but only if the car is placed in service by 9/30/25.

4. What about student loans?

Pell Grant and student loan reforms are included, but details are still being finalized.

5. Is this all permanent?

Many changes are permanent — but some, like the senior deduction and clean-tech deductions, are time-limited.

🛠️ What’s Next

1. The IRS and Treasury will issue guidance over the next 6–12 months. Expect:

2. New instructions for tip reporting and payroll withholding

3. Updated Schedule A guidance (esp. for SALT and charitable floors)

4. Revised depreciation schedules and Form 4562

5. Changes to FAFSA and student aid rules by 2026

🧠 JUJU Accounting Has Your Back

✨ Custom Projections: Let us model what OBBB means for your tax situation.

📞 Strategy Sessions: Schedule a 30-min call with Juju to plan 2025 deductions or restructure your entity.

🚀 Bottom Line

The One Big Beautiful Bill brings major tax opportunities for both individuals and businesses — but also introduces new limits, complexities, and planning deadlines. The earlier you start, the more you can save.

Let’s make sure you're ready.

Hey friends,

Ever get an envelope from the IRS and feel your heart drop a little? You're not alone. But don’t panic — most IRS letters are routine and don’t mean you’re in trouble. Here’s a quick guide on what to do if the IRS sends you mail.

Why the IRS Might Be Writing to You

The IRS usually sends notices or letters for one of these reasons:

• They have a question about your tax return.

• They made a change to your tax account.

• They’re requesting more information.

• They’re notifying you of a balance due or a correction.

Here’s What to Do:

• 1 Read It Carefully:
  Each notice addresses a specific issue and outlines the steps you should take. The faster you act, the more you can reduce penalties or interest if anything’s owed.

• 2 Review the Details:
  If the letter says your return was changed or corrected, compare it with your copy. If it makes sense, just keep a note with your records. If not, see #5 below.

• 3 Take Action (If Needed):
  If the letter asks for payment or documents, follow the instructions. You can also see many IRS letters by logging into your IRS Online Account. Payment plans are available if needed.

• 4 Only Reply If They Ask You To:
  Most notices don’t require a response. But if the letter says to reply — do it. If you need to call, use the number in the top right corner of the letter and have your tax return handy.

• 5 Don’t Ignore Mistakes:
  If something seems off, you can dispute it. Follow the instructions in the notice and send the IRS any documents that support your case.

• 6 Save That Letter!
  Keep any IRS notice you receive for at least 3 years. These are important records, especially if your tax return is ever audited or adjusted again.

Watch for Scams

The IRS will never contact you first via:

• Text

• Social media

• Email

Legit IRS contact almost always starts with snail mail. If you’re not sure if a letter is real, log into your IRS account or reach out to us — we’re happy to help double-check.

Need help reviewing an IRS letter?

JUJU Accounting has your back. We can help you figure out what it means and what to do next — so you don’t lose sleep over a piece of paper.

Love, Taxes, and the IRS – Here's What You Need to Know

Under certain circumstances, you can claim your boyfriend or girlfriend as a dependent on your tax return. If you're financially supporting your partner, the IRS might allow you to claim them for a tax benefit.

1 They lived with you all year.

Your partner must live in your home for the entire year, excluding temporary absences.

2 You provided over half of their support.

This includes basic needs such as food, housing, medical expenses, and transportation.

3 They made under $5,050 in gross income (2024).

Earnings over this threshold usually disqualify them unless it's tax-exempt income.

4 You’re not married.

If you're legally married, the dependent rule no longer applies.

5 No one else is claiming them.

Your partner cannot be claimed by someone else, such as their parent.

6 They meet the residency requirement.

They must be a U.S. citizen, national, or resident of the U.S., Canada, or Mexico.

What You Get:

If you meet all these requirements, you may be able to claim them as a “qualifying relative” and qualify for benefits like Head of Household status.

Note:

You won’t receive the Child Tax Credit for your partner, but you may qualify for other deductions. Keep documentation of shared expenses and income limits in case the IRS requests it.

Bottom Line:

If your partner depends on you financially, don’t overlook a potential tax break.

Even though the April 15 tax deadline has passed, it's not too late to take action if you couldn’t pay your tax bill in full. The IRS has several flexible payment options designed to help you catch up without unnecessary stress.

1. Online Payment Plans: Fast, Easy, and Available to Most 💻💸

Short-Term Payment Plan

• For balances under $100,000

• Gives you up to 180 days to pay in full

• Can be set up online in minutes

Long-Term Payment Plan

• For balances under $50,000

• Pay monthly for up to 10 years 🗓️

• Choose Direct Debit to automate payments and reduce the risk of default

Heads-up: Interest and penalties will continue to add up until the balance is paid

Apply through the IRS Online Payment Agreement Tool and get an instant decision—no phone calls, no paperwork! ✨

2. Can’t Qualify for a Payment Plan? Consider These Alternatives 🤔

Offer in Compromise

If your financial situation is serious, you may qualify to settle your tax debt for less than what you owe. Use the Offer in Compromise Pre-Qualifier to check eligibility. ✔️

Temporary Delay of Collection

If you’re facing financial hardship, the IRS may pause collections until your situation improves. Note: Interest and penalties will still accrue. ⏸️

3. Penalty Relief Might Be an Option 🛟

If you tried to comply with tax laws but couldn’t due to circumstances beyond your control, you may qualify for penalty relief. This could reduce or remove failure-to-file or failure-to-pay penalties.

4. Watch Out for Scams 🚨

The IRS will never call, text, or DM you asking for immediate payment.

Legit IRS communication comes by mail with clear instructions and options.

Not sure if you owe anything? Check securely with your IRS Online Account. 🔐

5. Estimated Tax Payment Reminder 🚨

Reminder: 2025 second quarter estimated tax payment (April 1–May 31) is due today, June 16, 2025.

Feel free to use our Estimated Tax Payment Checklist to see if you need to make a payment.

Need More Info? 📚

• Tax Topic 202: IRS Tax Payment Options

• Topic No. 653: Notices, Bills, Penalties, and Interest

• Visit IRS.gov for official tools and guidance

P.S. If you're unsure which option is right for you, or you’d like help navigating IRS tools, don’t hesitate to reach out. 

If you're a U.S. citizen or resident alien living or working abroad, the IRS wants you to know: your 2024 federal income tax return is due by Monday, June 16, 2025. This special deadline applies to expats, dual citizens, and military personnel stationed outside the U.S.

✈️ Who Gets the June 16 Deadline?

You're automatically granted this two-month extension from the usual April 15 deadline if either of the following applies:

• Your tax home and main place of business are outside the U.S. and Puerto Rico.

• You’re serving in the military or naval forces on duty outside the U.S. and Puerto Rico.

To use the extension, simply attach a statement to your tax return explaining which condition applies.

⏳ Need More Time?

You can request an additional extension to October 15, 2025, but remember:

An extension to file is not an extension to pay.

Interest applies to any tax owed after April 15, 2025.

File an extension online through IRS.gov or submit Form 4868 by mail if needed. Businesses use Form 7004.

💳 Making Payments from Abroad

You’ve got options—even without a U.S. bank account:

• IRS Direct Pay

• IRS Online Account

• EFTPS

• Foreign Wire Transfer (via Foreign Electronic Payments)

• Debit/credit card or digital wallet (note: fees may apply)

📅 Special Situations & Longer Extensions

• Military in combat zones: You may qualify for longer extensions automatically. See IRS Publication 3.

• Taxpayers affected by the Israel conflict: You may have until September 30, 2025, to file and pay. This includes taxpayers in Israel, Gaza, or the West Bank impacted since October 7, 2023.

💼 Don’t Miss Out on Tax Breaks

By filing, expats may qualify for:

• Foreign Earned Income Exclusion

• Foreign Tax Credit

Details in Publication 54.

🏦 Foreign Bank Accounts: Time to Report

If you had more than $10,000 in foreign financial accounts at any time in 2024, you must file:

FinCEN Form 114 (FBAR) by April 15, 2025 (automatic extension to October 15 available).

Form 8938 with your tax return if your foreign financial assets exceed reporting thresholds.

🌍 Global Income = U.S. Taxable

Yes, you still have to report:

• Worldwide income

• Foreign interest, dividends, and trusts

Include Schedule B with your return and disclose where your accounts are located.

💵 Report in U.S. Dollars

All income, deductions, and payments must be reported in USD, using the December 31, 2024 exchange rate. Use any posted rate consistently.

🛂 Renounced Citizenship or Green Card in 2024?

You’ll need to file a dual-status return. See Publication 519 for guidance.

Final Reminder:

Don’t miss the June 16 deadline—it’s not just about filing, it’s about protecting your eligibility for key credits and avoiding unnecessary penalties or interest.

Need help navigating your expat taxes? Feel free to reach out—we’re here for U.S. taxpayers around the globe. 🌍💼

If you (or a dependent) are in college, grad school, or pursuing a certificate program, you might qualify for one of two major education tax credits—but the rules can be tricky. Let’s clear it all up so you don’t leave money on the table!

1. American Opportunity Tax Credit (AOTC)

Up to $2,500 per student

• Covers 100% of the first $2,000 + 25% of the next $2,000 in qualified expenses.

• 40% refundable—you can get up to $1,000 back, even with no tax owed.

• Applies to the first 4 years of college.

• Covers tuition, fees, and required books/supplies/equipment—even if not bought from the school!

• Must be pursuing a degree or certificate and enrolled at least half-time.

 Income Limits (2024–2025):

• Phased out if your MAGI is over $80,000–$90,000 (single) or $160,000–$180,000 (MFJ).

2. Lifetime Learning Credit (LLC)

Up to $2,000 per tax return

• Equals 20% of up to $10,000 in eligible expenses.

• Great for grad school, part-time study, or career development.

• No limit on how many years you can claim it!

• Covers tuition and fees—but books/supplies count only if paid directly to the school.

• No degree requirement, and no half-time enrollment needed.

 Same Income Limits as AOTC:

• Phased out at $80,000–$90,000 (single) / $160,000–$180,000 (MFJ).

3. What’s a Qualified Education Expense?

Eligible for AOTC:

• Tuition

• Fees

• Books, supplies, and equipment required for enrollment (even if purchased off-campus)

• Lab kits or special tools (if required)

Eligible for LLC:

• Tuition

• Fees

• Books/supplies/equipment only if paid directly to the school

 Not Covered by Either Credit:

• Room and board

• Insurance

• Transportation

• Sports or fitness fees (unless required by the course)

4. One Credit Per Student Rule

• You can’t claim both AOTC and LLC for the same student in the same year.

• You can claim AOTC for one student and LLC for another (e.g., your child and yourself).

5. Don’t Forget These Essentials

• You’ll need Form 1098-T from the school to claim either credit.

• Scholarships and grants reduce your qualified expenses. (Example: If tuition is $10,000 and you get a $4,000 scholarship, only $6,000 qualifies.)

• K–12 expenses don’t count—these are for postsecondary education only.

Real Talk from JUJU

If you're paying for school—or helping someone else who is—these credits can put serious cash back in your pocket. But they each have specific rules, and small mistakes can cost you. So keep receipts, double-check your 1098-T, and make sure you're not accidentally claiming ineligible expenses.

Got questions about your situation? Need help filing or planning ahead? You know where to find me.