Caudell CPA, PC

If you used one or more vehicles in your business during 2025, you may be eligible for valuable tax deductions on your 2025 income tax return. But the rules are complicated, and your deductions may be affected by factors such as the vehicle’s weight and business vs. personal use. The year you place a car, SUV, van, pickup or panel truck in service, you can choose to deduct the actual expenses (such as gas, insurance, repairs and registration fees) and depreciation attributable to your business use of the vehicle or claim the cents-per-mile deduction (with a depreciation allowance built into it). Heavier vehicles may be eligible for larger deductions. Contact us if you have questions.

You know your 2025 federal income tax return is due April 15, 2026. But do you know what else has an April 15 deadline? If you don’t, you could miss out on valuable tax-saving opportunities or become subject to interest and even penalties. The April 15 deadline also generally applies to 1) making 2025 IRA contributions, 2) making 2025 SEP contributions, 3) paying the first installment of 2026 estimated taxes, 4) filing a 2025 income tax return for a trust or estate, 5) filing a 2025 gift tax return, and 6) filing a Report of Foreign Bank and Financial Accounts (FBAR). An extension is available in some cases, but not for the payment of tax due. Contact us to discuss which deadlines apply to you.

In Notice 2026-13, the IRS recently updated its model notices for qualified retirement plan rollover distributions to reflect changes under the SECURE 2.0 Act. The model notices now incorporate two revised safe-harbor explanations: one for non-Roth distributions and one for designated Roth accounts. The revised notices also address expanded exceptions to the 10% early withdrawal penalty, higher required minimum distribution ages, the increased $7,000 mandatory cash-out threshold and special rules for “pension-linked” emergency savings accounts. Plan administrators and payors aren’t required to use the IRS models, but they’re generally considered a good place to start. Contact us to learn more.

If your business uses the accrual method of accounting and received advance payments in 2025, you may be able to defer reporting some or all of that income until 2026 for federal tax purposes. An advance payment is one received by a business before it provides whatever is being paid for. Examples of advance payments that may be eligible for this favorable tax treatment include payments for services, the sale of goods, gift cards, the use of intellectual property, the sale or use of computer software, warranty contracts and subscriptions. But complicated rules apply. Contact us for help determining if your business is eligible to defer 2025 advance payments.

Personal interest expense generally can’t be deducted for federal tax purposes. But there are exceptions. You probably know that home mortgage interest may be deductible if you itemize deductions rather than claiming the standard deduction. New for 2025 through 2028, you may be eligible to deduct up to $10,000 of car loan interest if the vehicle’s “final assembly” was in the U.S. and other requirements are met. But the deduction phases out starting at $100,000 of modified adjusted gross income ($200,000 for married couples filing jointly). Other potential interest expense deductions are student loan interest and investment interest. Contact us with any questions.

For employers, terminating an employee can cost far more than a final paycheck. Depending on state rules and company policies, you may need to settle final wages and paid time off within required timeframes. Mistakes in withholding or benefit deductions can create extra administrative work and compliance risk. And benefits don’t always end cleanly, especially when COBRA or state continuation rules apply. Additional payroll, tax and unemployment insurance considerations can further increase the total cost, particularly for remote or multistate arrangements. Contact us for help evaluating the cost impact of any termination decision.

Claiming the maximum depreciation deductions you can on your 2025 income tax return will generally provide the greatest 2025 tax savings. But sometimes it may be better to depreciate business assets over a period of years, such as if you expect to become subject to higher tax rates. If you claim 100% bonus depreciation or Sec. 179 expensing today, you’re eliminating future depreciation deductions for those assets. And deductions save more tax when tax rates are higher. We can identify which depreciation breaks you’re eligible for, review your overall tax situation and help determine whether you should maximize depreciation-related breaks on your 2025 return. Contact us to get started.

Raising a family comes with plenty of expenses, but it may also make you eligible for various tax breaks. Some of the most valuable are tax credits, because they reduce your tax liability dollar for dollar (unlike deductions, which only reduce the amount of income subject to tax). Which credits might you be eligible for on your 2025 return? The child credit, credit for other dependents, child and dependent care credit, adoption credit, American Opportunity credit and Lifetime Learning credit are some of the possibilities. But various rules and income-based limits apply. We can help ensure you maximize your tax savings from these and other tax breaks you’re eligible for.

Trump Account Contribution Programs (TACPs) allow employers to help fund Trump Accounts for eligible under-age-18 employees and employees’ eligible dependents. Recent IRS guidance (Notice 2025-68) clarifies some key points. For example, TACPs can’t start until July 4, 2026, when accounts may first be established and funded. Also, excludable employer contributions are capped at $2,500 per employee per year, regardless of the number of dependents. That limit will be indexed for inflation after 2027. Employers may offer TACPs through a cafeteria plan, but certain restrictions apply. Contact us for help exploring the feasibility of a TACP for your organization.