July 14, 2025

Big Beautiful Tax Cuts by the One Big Beautiful Bill

Big Beautiful Tax Cuts by the One Big Beautiful Bill
iHeartRadio podcast player iconSpotify podcast player iconAmazon Music podcast player iconApple Podcasts podcast player iconAudible podcast player iconPandora podcast player iconDeezer podcast player iconPodchaser podcast player iconSpreaker podcast player iconPodcast Addict podcast player iconJioSaavn podcast player iconCastbox podcast player iconYoutube Music podcast player iconYouTube podcast player iconCastamatic podcast player iconOvercast podcast player iconCastro podcast player iconFountain podcast player iconGoodpods podcast player iconPocketCasts podcast player iconPodurama podcast player iconPodverse podcast player iconPodyssey podcast player iconRSS Feed podcast player icon
iHeartRadio podcast player iconSpotify podcast player iconAmazon Music podcast player iconApple Podcasts podcast player iconAudible podcast player iconPandora podcast player iconDeezer podcast player iconPodchaser podcast player iconSpreaker podcast player iconPodcast Addict podcast player iconJioSaavn podcast player iconCastbox podcast player iconYoutube Music podcast player iconYouTube podcast player iconCastamatic podcast player iconOvercast podcast player iconCastro podcast player iconFountain podcast player iconGoodpods podcast player iconPocketCasts podcast player iconPodurama podcast player iconPodverse podcast player iconPodyssey podcast player iconRSS Feed podcast player icon
Season 2

Tax Talk 4 U : Big Beautiful Tax Cuts by One Big Beautiful Bill. Tr President Trump signed H.R. 1, One Big Beautiful Bill Act (OBBBA), into law on July 4, permanently.
extending key Tax Cuts and Jobs Act (TCJA) provisions and introducing new tax provisions. Increased standard deduction, deduction for seniors, Extension with changes to child tax credit, child and dependent care tax credit, No tax on tips , No tax on overtime, Deductible car loan interest, Charitable Contributions deduction.

Tax Talk 4 U is broadcast live Mondays at 10AM ET and Music on W4CY Radio (www.w4cy.com) part of Talk 4 Radio (www.talk4radio.com) on the Talk 4 Media Network (www.talk4media.com). Tax Talk 4 U is viewed on Talk 4 TV (www.talk4tv.com).

Tax Talk 4 U Podcast is also available on Talk 4 Media (www.talk4media.com), Talk 4 Podcasting (www.talk4podcasting.com), iHeartRadio, Amazon Music, Pandora, Spotify, Audible, and over 100 other podcast outlets.

Become a supporter of this podcast: https://www.spreaker.com/podcast/tax-talk-4-u--6333550/support.

WEBVTT

1
00:00:00.080 --> 00:00:02.319
The topics and opinions express in the following show are

2
00:00:02.359 --> 00:00:03.960
solely those of the hosts and their guests and not

3
00:00:04.040 --> 00:00:06.919
those of w FOCY Radio. It's employees are affiliates. We

4
00:00:07.000 --> 00:00:10.039
make no recommendations or endorsements for radio show programs, services,

5
00:00:10.119 --> 00:00:12.439
or products mentioned on air or on our web. No

6
00:00:12.560 --> 00:00:15.720
liability explicitor implies shall be extended to W FOURCY Radio

7
00:00:15.800 --> 00:00:18.519
or it's employees are affiliates. Any questions or comments should

8
00:00:18.559 --> 00:00:20.879
be directed to those show hosts. Thank you for choosing

9
00:00:21.039 --> 00:00:23.640
W FOURCY Radio.

10
00:00:27.960 --> 00:00:28.359
Barry G.

11
00:00:28.519 --> 00:00:31.600
Fouler EA brings you tax talk for you right here

12
00:00:31.640 --> 00:00:35.159
on W four CY Radio and talk for TV. As

13
00:00:35.200 --> 00:00:39.000
an enrolled agent and a national leader in tax resolution

14
00:00:39.640 --> 00:00:43.719
as well as Trucker bookkeeping and tax planning. With over

15
00:00:43.799 --> 00:00:49.200
thirty years of experience, Barry will break down taxes, bookkeeping,

16
00:00:49.679 --> 00:00:53.880
tax planning, and tax relief for individuals and businesses just

17
00:00:54.039 --> 00:00:57.079
like you. So let's have some tax talk for you

18
00:00:57.479 --> 00:00:58.439
with your hosts.

19
00:00:58.920 --> 00:00:59.439
Barry G.

20
00:00:59.679 --> 00:01:11.079
Foul heyday of talking about one big, beautiful bill. You know,

21
00:01:11.439 --> 00:01:16.079
it's amazing to me that we passed legislation and instead

22
00:01:16.120 --> 00:01:18.599
of breaking things down and doing them in small bills,

23
00:01:18.599 --> 00:01:23.400
so they do this one humongous, big, beautiful bill, as

24
00:01:23.439 --> 00:01:27.040
Trump calls it and as it's called in law. Now,

25
00:01:27.480 --> 00:01:29.079
there are a lot of good things that happened in

26
00:01:29.120 --> 00:01:32.079
this bill, and I understand that some thing's going to

27
00:01:32.159 --> 00:01:35.400
take a lot of pages. But this bill is I

28
00:01:35.400 --> 00:01:39.920
believe eight hundred and seventy pages long. It's right around there.

29
00:01:40.000 --> 00:01:43.480
I've looked at it, studied this bill, and we're kind

30
00:01:43.480 --> 00:01:48.560
of dissecting just the tax part of this bill that

31
00:01:48.959 --> 00:01:55.400
President Trump signed into law on July fourth. Now, one

32
00:01:55.480 --> 00:02:00.760
part of this bill, which is great, it permanently extended

33
00:02:00.920 --> 00:02:07.280
key Tax Cuts and Jobs Act provisions and then introduce

34
00:02:07.599 --> 00:02:12.560
new tax provisions as well. So what we've been operating

35
00:02:12.560 --> 00:02:16.120
on for the last roughly eight years, we're going to

36
00:02:16.120 --> 00:02:21.560
continue operating underneath that original Tax Cuts and Job Acts

37
00:02:21.960 --> 00:02:24.400
plus the new provisions that are put in, and we're

38
00:02:24.400 --> 00:02:27.120
going to discuss a lot of those new provisions here

39
00:02:27.280 --> 00:02:32.039
in the show. The new legislation introduces tax relief for

40
00:02:32.199 --> 00:02:37.000
middle class families and workers, and also aim to simplify,

41
00:02:37.439 --> 00:02:43.879
simplify compliance, reduce taxable income for certain earners, and broaden

42
00:02:44.000 --> 00:02:48.759
access to tax benefits. This all built around the twenty

43
00:02:48.919 --> 00:02:54.719
seventeen Tax Cuts and Jobs Act. Now in this bill,

44
00:02:55.479 --> 00:03:01.360
you're going to see the extension and on getting phone

45
00:03:01.360 --> 00:03:03.439
calls in the middle of talking and I thought we

46
00:03:03.520 --> 00:03:06.120
turned everything off, but my watch, it keeps going going off.

47
00:03:06.199 --> 00:03:08.360
Now I got to figure out how to silence that

48
00:03:08.479 --> 00:03:12.280
as well. You know, it's going to enhance the standard deduction,

49
00:03:12.599 --> 00:03:17.919
introduce some notable updates including deduction for overtime, expanded childcare credits,

50
00:03:18.639 --> 00:03:23.439
deduction for seniors, also launches Trump Accounts for young savers.

51
00:03:24.960 --> 00:03:26.439
So we're going to kind of go through each one

52
00:03:26.479 --> 00:03:29.120
of these things all throughout this program. But this is

53
00:03:29.159 --> 00:03:31.919
all going to be geared around the individual side. Now.

54
00:03:32.400 --> 00:03:35.879
You know, we spent many many hours going through this

55
00:03:35.960 --> 00:03:39.759
whole bill and pulling out sections of this bill to

56
00:03:39.800 --> 00:03:43.240
be able to talk about to help you further understand

57
00:03:43.360 --> 00:03:47.680
what this does for you as an individual taxpayer. Now,

58
00:03:47.719 --> 00:03:49.479
next week we're going to enjoys a lot of the

59
00:03:49.560 --> 00:03:54.680
stuff in this bill that involves businesses, and so you

60
00:03:54.800 --> 00:03:57.759
want to make sure you turn tune into Tax Talk

61
00:03:57.840 --> 00:04:03.960
for you next week at ten am Eastern time to

62
00:04:04.039 --> 00:04:06.879
be able to get what this bill does for you

63
00:04:07.080 --> 00:04:11.719
and your business. But this bill, on the individual side,

64
00:04:12.400 --> 00:04:15.680
it does an extension of reduced income tax rates, So

65
00:04:16.399 --> 00:04:22.279
the provision permanently extends the individual income tax rates introduced

66
00:04:22.279 --> 00:04:27.639
by the TCJA that were previously set to expire at

67
00:04:27.639 --> 00:04:31.720
the end of this year. The amendment to the bill

68
00:04:31.879 --> 00:04:36.399
eliminates the sunset class and ensures that they are reduced.

69
00:04:36.519 --> 00:04:40.639
Marginal rates of the ten, twelve, twenty to twenty four,

70
00:04:40.879 --> 00:04:45.680
thirty two, thirty five, thirty seven remain in place. This

71
00:04:45.800 --> 00:04:50.240
provision is intended to lock in those lower marginal tax rates,

72
00:04:50.399 --> 00:04:53.439
prevent automatic rate hikes that were going to happen in

73
00:04:53.480 --> 00:04:59.120
twenty twenty six, provide continued tax relief to individuals and families,

74
00:04:59.240 --> 00:05:03.639
and control the way bracket thresholds grow with inflation for

75
00:05:03.959 --> 00:05:09.079
better targeting of the rate brackets. So that being said,

76
00:05:09.120 --> 00:05:10.480
we don't have to be scared and all of a

77
00:05:10.480 --> 00:05:12.439
sudden in twenty twenty six, all of our rates are

78
00:05:12.439 --> 00:05:14.079
going to jump up and we're going to go back

79
00:05:14.079 --> 00:05:19.959
to some real old code. So that's the good news

80
00:05:20.120 --> 00:05:22.959
in this bill. It's one thing that us as tax

81
00:05:23.000 --> 00:05:27.519
prepayers we're really hoping for, was the extension of the

82
00:05:27.560 --> 00:05:32.279
tax law. With the election of President Trump and Republicans

83
00:05:33.040 --> 00:05:37.360
being in Congress and dominating both houses. We figured this

84
00:05:37.519 --> 00:05:41.160
should go through, and we're glad that it did because

85
00:05:41.680 --> 00:05:45.680
it really ensures that we keep these rates going out

86
00:05:45.759 --> 00:05:48.959
to the future. There are two changes to the standard

87
00:05:49.000 --> 00:05:54.600
deduction rules now. The first, the law permanently preserves the

88
00:05:54.639 --> 00:05:58.519
current tax code enhance the standard deduction amounts under the

89
00:05:58.560 --> 00:06:03.360
prior law increased deduction initially established for years eighteen through

90
00:06:03.360 --> 00:06:08.000
twenty five. Those were set to revert back to the

91
00:06:08.040 --> 00:06:14.759
twenty eighteen levels beginning in twenty six. The law also

92
00:06:14.839 --> 00:06:19.920
increases the base standard deduction amounts beginning in this year.

93
00:06:20.399 --> 00:06:23.920
So we were already getting a jump for inflation, but

94
00:06:24.199 --> 00:06:28.680
we're also getting the jump and increase with this bill.

95
00:06:28.920 --> 00:06:32.000
So the new base deduction is thirty one thousand and

96
00:06:32.160 --> 00:06:38.040
five hundred, so it is an increase over if inflation

97
00:06:38.160 --> 00:06:42.800
adjusted amount of thirty thousand. So Mary finally joint it's

98
00:06:42.800 --> 00:06:45.839
now thirty one to five for twenty twenty five, so

99
00:06:45.879 --> 00:06:50.519
it jumped up fifteen hundred dollars, So the new amount

100
00:06:50.600 --> 00:06:55.000
for single is half of that. That's fifteen thousand and

101
00:06:55.040 --> 00:06:59.879
seven fifty, exceeding the prior inflation adjusted amount for the

102
00:07:00.199 --> 00:07:03.519
year of fifteen thousand, So there's an extra seven hundred

103
00:07:03.560 --> 00:07:06.079
and fifty dollars if you're single, extra fifteen hundred dollars

104
00:07:06.120 --> 00:07:10.000
if you're married filing jointly. Now, this is a standard deduction,

105
00:07:10.480 --> 00:07:13.800
and you know we have seen, you know, unless you've

106
00:07:13.800 --> 00:07:17.360
taken out a new mortgage in the last four years,

107
00:07:18.560 --> 00:07:22.560
many people didn't qualify to itemize. Many people just took

108
00:07:22.600 --> 00:07:27.160
the standard deduction. So that's really a nice provision in

109
00:07:27.240 --> 00:07:32.519
this tax law. So you see a bigger standard deduction

110
00:07:33.079 --> 00:07:38.000
for this year and and then it'll start being inflation

111
00:07:38.120 --> 00:07:42.480
adjusted every year there after. So it's going to give

112
00:07:42.759 --> 00:07:51.040
a direct savings to many many US households starting this year. Also,

113
00:07:51.240 --> 00:07:58.519
we have some termination of permit personal exemptions. Those were

114
00:07:59.160 --> 00:08:05.279
temporarily spended underneath the Tax Jobs Credit Act. This makes

115
00:08:05.319 --> 00:08:10.519
it permanent, so we won't have the individual exeptions coming back.

116
00:08:10.560 --> 00:08:16.800
You just got the larger standard deduction. Now Trump kind

117
00:08:16.800 --> 00:08:21.199
of promised no tax on Social Security. Well, Congress gets involved,

118
00:08:21.199 --> 00:08:23.519
Congress decides they're going to do it a different way.

119
00:08:23.920 --> 00:08:28.319
Now it knits down to it. It basically gives no

120
00:08:28.480 --> 00:08:32.879
tax on Social Security, but it gives the seniors beginning

121
00:08:33.519 --> 00:08:38.200
this year through twenty twenty eight, individuals age sixty five

122
00:08:38.279 --> 00:08:40.559
or older. By the end of the year, you get

123
00:08:40.559 --> 00:08:44.399
to claim new deduction of six thousand dollars on a

124
00:08:44.480 --> 00:08:49.720
joint return. Each spouse may qualify for that six thousand dollars,

125
00:08:49.799 --> 00:08:53.200
giving you a total of twelve thousand in total deductions

126
00:08:53.639 --> 00:08:57.679
as long as you're both age sixty five. Now they

127
00:08:57.720 --> 00:09:00.840
through its phase house, So they say this bill is

128
00:09:00.879 --> 00:09:05.399
only benefiting the rich. These phase outs are because people

129
00:09:05.559 --> 00:09:09.080
make too much money, according to Congress. Not in my opinion,

130
00:09:09.440 --> 00:09:13.879
Congress's opinion, president's opinion. Maybe, but I really think it's

131
00:09:13.879 --> 00:09:17.919
just purely Congress trying to appease certain people and saying, hey,

132
00:09:17.919 --> 00:09:20.639
we're going to continue to tax those be considered to

133
00:09:20.679 --> 00:09:24.200
be rich. Now, believe it or not, this bill has

134
00:09:24.240 --> 00:09:28.159
a six percent phase now on modified adjusted gross income

135
00:09:28.840 --> 00:09:34.080
exceeding seventy five thousand for single filers. I raise your

136
00:09:34.080 --> 00:09:37.720
hand if you consider seventy five thousand as a single

137
00:09:37.759 --> 00:09:41.759
person rich and wealthy. Only the Congress raise their hand.

138
00:09:42.000 --> 00:09:45.039
One hundred and fifty thousand for joint filers. How many

139
00:09:45.080 --> 00:09:48.120
of you making that kind of money consider yourself to

140
00:09:48.159 --> 00:09:52.320
be totally rich to start having these phase outs? Only

141
00:09:52.399 --> 00:09:57.200
Congress is raising their hands now. Now a couple other things.

142
00:09:57.399 --> 00:10:00.759
Seniors must possess a valid Social Security number to claim

143
00:10:00.799 --> 00:10:03.639
the deduction. I haven't seen anybody file without a valid

144
00:10:03.639 --> 00:10:06.759
sold Security number. Maybe it TI N number, but you

145
00:10:06.879 --> 00:10:09.000
got to have a valid so Security number. In a

146
00:10:09.080 --> 00:10:12.440
mission or invalid sold security is treated as a mathematical

147
00:10:12.600 --> 00:10:17.039
or lyrical error, authoring authorizing the IRIS to adjust the

148
00:10:17.080 --> 00:10:21.679
return Accordingly, they get to adjust your return. Married individuals

149
00:10:21.759 --> 00:10:25.480
must file a joint return to be eligible. Married filing

150
00:10:25.600 --> 00:10:30.279
separate is not permitted for this deduction. So if you're married,

151
00:10:30.320 --> 00:10:33.320
you got to file a joint return sixty five or older.

152
00:10:33.440 --> 00:10:36.759
You both can get it. If you file married filing separate,

153
00:10:36.840 --> 00:10:39.399
it is not going to be Wow. A lot of

154
00:10:39.519 --> 00:10:43.000
changes already. We're talking quick through this bill, and you

155
00:10:43.000 --> 00:10:45.159
know we only get an hour to do this. We're

156
00:10:45.159 --> 00:10:47.080
going to take a quick break and when we come back,

157
00:10:47.159 --> 00:10:50.919
we're going to talk about extensions. We have changes to

158
00:10:51.039 --> 00:10:54.360
the child tax credit. Right back after this.

159
00:10:56.519 --> 00:11:00.200
We have only scratched the surface of today's show. Please

160
00:11:00.279 --> 00:11:03.519
stand by as Barry G. Fowler will be right back

161
00:11:03.559 --> 00:11:09.519
with taxtock for you. If you owe the IRS or

162
00:11:09.559 --> 00:11:12.919
are going through an IRS audit, don't go at it.

163
00:11:12.960 --> 00:11:16.200
Alone. Call Taxation Solutions Tax.

164
00:11:15.840 --> 00:11:19.600
Relief at eight eight eight nine three zero one zero

165
00:11:19.759 --> 00:11:24.759
one six. We are your solution for IRS, debts, audits,

166
00:11:25.159 --> 00:11:30.600
back taxes, garnishments, leans and levees. Whether you're an individual

167
00:11:30.679 --> 00:11:34.919
or business, you need a solution and a strong, aggressive

168
00:11:35.080 --> 00:11:36.039
tax resolution.

169
00:11:36.879 --> 00:11:39.000
Don't let the IRS walk all over you.

170
00:11:39.279 --> 00:11:43.159
Stop the IRS now call eight eight eight nine three

171
00:11:43.240 --> 00:11:48.080
zero one zero one six or go to Taxationsolutions dot

172
00:11:48.200 --> 00:11:56.679
net now for a free no obligation consultation. Let's get

173
00:11:56.679 --> 00:11:59.720
back to tax stock for you with more tax stock

174
00:12:00.279 --> 00:12:00.919
once again.

175
00:12:01.360 --> 00:12:03.919
Here's your host, Barry G. Faller.

176
00:12:06.200 --> 00:12:09.960
All right, you got children. What's changed with the child

177
00:12:10.039 --> 00:12:16.240
tax credits? So there's been several changes to the child

178
00:12:16.320 --> 00:12:20.600
tax credits and it takes effect starting this year. So

179
00:12:21.519 --> 00:12:25.080
what we were fixing to do is at the end

180
00:12:25.159 --> 00:12:28.200
of this year, child tax credit was going to drop

181
00:12:28.279 --> 00:12:31.000
back down to the original amount of one thousand dollars.

182
00:12:31.039 --> 00:12:36.360
But this bill, effective twenty twenty five, the maximum child

183
00:12:36.919 --> 00:12:41.399
tax credit for qualifying child increases from the two thousand

184
00:12:41.960 --> 00:12:45.720
to twenty two hundred beginning in twenty twenty six. This

185
00:12:45.759 --> 00:12:50.039
amount is subject to annual inflation adjustments. Now, the refundable

186
00:12:50.080 --> 00:12:54.559
portion of that credit remains capped at fourteen hundred per child,

187
00:12:55.080 --> 00:12:58.600
but that is also going to be indexed for inflation

188
00:12:58.840 --> 00:13:02.159
beginning this year, so we might see some adjustments to

189
00:13:02.240 --> 00:13:06.600
that as well. Now, what do they mean about you know, Hey,

190
00:13:06.639 --> 00:13:08.639
you get a twenty two hundred dollars tax credit, but

191
00:13:08.720 --> 00:13:11.559
you only get fourteen hundred of it refundable. So if

192
00:13:11.559 --> 00:13:16.039
you are paying taxes and you have tax showing on

193
00:13:16.080 --> 00:13:21.720
your tax return, not owing, but total tax, the duck

194
00:13:21.799 --> 00:13:24.679
to twenty two hundred from that total tax, and it

195
00:13:24.799 --> 00:13:27.799
leaves you what's left to be paid. Now, if twenty

196
00:13:27.799 --> 00:13:30.720
two hundred is used to get you down to zero tax,

197
00:13:31.240 --> 00:13:34.480
then you can still get fourteen hundred refundable to you,

198
00:13:35.600 --> 00:13:39.039
possibly depending on how much of that credit was used.

199
00:13:39.600 --> 00:13:43.759
So if you didn't use all twenty two hundred, let's

200
00:13:43.799 --> 00:13:46.519
say maybe you only hit one thousand dollars a total tax,

201
00:13:46.919 --> 00:13:50.360
they'll use a thousand of that twenty two and refund

202
00:13:50.360 --> 00:13:53.679
you the twelve hundred dollars difference plus any of your

203
00:13:53.679 --> 00:13:58.159
federal withholdings that you've paid in. So you know, you

204
00:13:58.240 --> 00:14:02.960
got to look at whether you qualify or not qualifying.

205
00:14:03.360 --> 00:14:06.240
Here again, you must have a valid so security number

206
00:14:07.759 --> 00:14:12.399
must be US citizen or certain legal residents could qualify

207
00:14:12.639 --> 00:14:17.600
as well, you know, so keep those things in mind

208
00:14:18.240 --> 00:14:21.399
as you're going through and doing this. Hey, one of

209
00:14:21.480 --> 00:14:25.600
the nice parts about this bill. We're going to kind

210
00:14:25.600 --> 00:14:28.080
of skip through a few of the sections out here

211
00:14:28.159 --> 00:14:31.159
because there are other enhancements out here, but this is

212
00:14:31.240 --> 00:14:35.519
one of the places that people really wanted to know about.

213
00:14:35.840 --> 00:14:41.759
You heard it, no tax on tips. That's right, Trump

214
00:14:41.799 --> 00:14:46.759
said it, no tax on tips. Congress got involved. Guess

215
00:14:46.799 --> 00:14:51.960
what limitations, of course are. So Section two two four

216
00:14:52.600 --> 00:14:57.840
allows individuals to deduct certain cash tips from their taxable income.

217
00:14:58.200 --> 00:15:02.080
The deduction is available for tax years beginning after December

218
00:15:02.159 --> 00:15:04.799
thirty one, twenty twenty four, so starting in twenty five

219
00:15:05.240 --> 00:15:09.399
through twenty eight. This applies to individuals who receive cash

220
00:15:09.399 --> 00:15:13.919
tips and an occupation that customarily and regularly receive tips.

221
00:15:14.320 --> 00:15:19.320
Now who that is and the professions that are included

222
00:15:19.440 --> 00:15:22.960
is going to be determined by the IRS will be

223
00:15:23.000 --> 00:15:28.039
published sometime this year. Hopefully both employees and self employed

224
00:15:28.039 --> 00:15:32.000
individuals may be eligible, but the deduction is limited for

225
00:15:32.039 --> 00:15:37.679
self employed taxpayers if business expenses exceed income. Now, marry

226
00:15:37.759 --> 00:15:40.639
tax payers are going to have to file jointly to

227
00:15:40.639 --> 00:15:44.480
claim the deduction. So now the one thing I want

228
00:15:44.519 --> 00:15:46.360
to say is the tip's still got to be reported

229
00:15:46.399 --> 00:15:48.559
on New W two. Are still going to be taxed

230
00:15:48.559 --> 00:15:51.440
for Social Security and Medicare, They're just not going to

231
00:15:51.440 --> 00:15:56.759
be taxed for federal income tax. Now that deduction is limited,

232
00:15:57.080 --> 00:16:00.159
and it's capped at twenty five thousand per year here

233
00:16:00.720 --> 00:16:06.159
and phases out if you're modified adjusted gross income exceeds

234
00:16:06.200 --> 00:16:09.399
one hundred and fifty thousand for an individual or three

235
00:16:09.519 --> 00:16:13.960
hundred thousand for joint bi holer. Now, it's amazing, seniors,

236
00:16:14.559 --> 00:16:18.519
you get capped at a much lower level than the

237
00:16:18.559 --> 00:16:21.639
people that are getting tips and are being capped at

238
00:16:21.639 --> 00:16:25.080
a much higher level. Why is that so? What they

239
00:16:25.080 --> 00:16:28.720
were figuring is is that if you're retired and you're

240
00:16:28.960 --> 00:16:32.960
getting above that seventy five thousand as an individual, soial

241
00:16:32.960 --> 00:16:37.960
security and having taxes means you're probably rich and pulling

242
00:16:38.000 --> 00:16:40.720
more money out of retirement accounts than other people. They

243
00:16:40.759 --> 00:16:43.320
were trying to give you just the benefit of no

244
00:16:43.519 --> 00:16:47.519
tax on Social security portion of it. Now, a lot

245
00:16:47.559 --> 00:16:51.480
of people have been asking me what is defined as

246
00:16:51.720 --> 00:16:55.399
a tip? Because you see in the first section and

247
00:16:55.519 --> 00:17:00.159
first time we read through the law. It said cash tips, meaning, hey,

248
00:17:00.200 --> 00:17:01.919
do I actually got to lay down, you know, the

249
00:17:01.960 --> 00:17:06.880
greenbacks on the table for my waitress or a waiter

250
00:17:07.400 --> 00:17:10.599
to tip them, you know? Or can I put it

251
00:17:10.640 --> 00:17:13.559
in my credit cards? So they do later in this

252
00:17:13.640 --> 00:17:18.160
bill state tax tips tips that are not going to

253
00:17:18.160 --> 00:17:22.000
be taxed, and you're going to include cash and card

254
00:17:22.039 --> 00:17:28.240
based payments and amounts distributed through tip sharing arrangements. So

255
00:17:29.119 --> 00:17:32.319
the tip be perfectly honest. Here, it's got to be

256
00:17:32.480 --> 00:17:36.599
made voluntarily by the customer and not subject to negotiation

257
00:17:37.240 --> 00:17:42.240
or determined by the restaurant or the place of business.

258
00:17:42.759 --> 00:17:47.759
Should be determined solely at the customer's discretion. However, tips

259
00:17:47.839 --> 00:17:53.160
received in a specified service trade or business as defined

260
00:17:53.240 --> 00:17:58.160
under Section one N nine are excluded unless the recipient

261
00:17:58.359 --> 00:18:02.960
is an employee or of an employer not classified as

262
00:18:03.599 --> 00:18:08.119
a specified service trade business. I sure hope they're going

263
00:18:08.160 --> 00:18:10.920
to interpret some wonderful rules. I know what this means,

264
00:18:11.359 --> 00:18:16.039
but the normal American taxpayer doesn't. Now, does this rule

265
00:18:16.160 --> 00:18:20.440
mean that Let's say you are the waiter or waitress

266
00:18:20.599 --> 00:18:25.119
and you have a party of ten or more that

267
00:18:25.240 --> 00:18:30.960
you're serving, and there's an automatic tip calculated into the bill.

268
00:18:31.119 --> 00:18:34.440
Does that mean you don't get to exclude those tips.

269
00:18:35.119 --> 00:18:37.279
We're still having a way to see how the IRS

270
00:18:37.319 --> 00:18:41.359
interprets this fun stuff that's in this bill.

271
00:18:41.799 --> 00:18:41.920
Now.

272
00:18:41.920 --> 00:18:44.799
I don't think they were meaning to put that in there.

273
00:18:45.400 --> 00:18:47.640
I think they were meaning that if you were in

274
00:18:47.680 --> 00:18:51.960
a specified service and you know, maybe you were required

275
00:18:52.000 --> 00:18:54.559
to leave this give this kind of tip as part

276
00:18:54.599 --> 00:18:57.799
of the service contract, those would be excluded. I just

277
00:18:57.799 --> 00:19:00.160
don't know how they're going to make this work. We

278
00:19:00.200 --> 00:19:03.279
were concerned at the get go of this when they

279
00:19:03.279 --> 00:19:05.920
were announcing no tax on tips, was it going to

280
00:19:05.960 --> 00:19:10.319
include social Security of Medicare? Because you as a tipped servance,

281
00:19:10.920 --> 00:19:13.359
if you're not reporting it and paying tax under Social

282
00:19:13.359 --> 00:19:16.559
Security at Medicare, then you're not going to get credit

283
00:19:16.640 --> 00:19:21.240
for those tips towards social Security and solid security is

284
00:19:21.279 --> 00:19:25.279
based off of your past earnings. So would that mean

285
00:19:25.440 --> 00:19:28.279
that there'd be a huge reduction in what you would

286
00:19:28.279 --> 00:19:31.839
be receiving later in life because we weren't including these

287
00:19:31.880 --> 00:19:35.200
tips over there. So, you know, those are the kind

288
00:19:35.200 --> 00:19:37.599
of things we were kind of concerned about. But it

289
00:19:37.640 --> 00:19:40.119
looks like they're accomplishing that and still having it put

290
00:19:40.160 --> 00:19:43.039
on the W two. The employer is still paying their

291
00:19:43.079 --> 00:19:47.440
portion on tax tips and reported you're paying your portion

292
00:19:47.680 --> 00:19:51.000
on those tips as well, so you know there's still

293
00:19:51.039 --> 00:19:53.920
going to be tips going in. Tax on tips going

294
00:19:53.960 --> 00:19:57.960
into Social Security medicare just no federal income tax on

295
00:19:58.640 --> 00:20:02.920
subject up to the limitation of twenty five thousand dollars.

296
00:20:04.039 --> 00:20:07.480
So just remember the limit is up to twenty five thousand,

297
00:20:07.480 --> 00:20:11.039
and qualified tips that's where the deduction limit is at

298
00:20:11.839 --> 00:20:14.160
has an income phase out at one hundred and fifty

299
00:20:14.200 --> 00:20:18.599
thousand for single three hundred thousand joint tips must be

300
00:20:18.759 --> 00:20:25.640
voluntary and it has to be from a tip eligible occupation.

301
00:20:26.359 --> 00:20:30.079
Time frame on this thing again is twenty twenty five

302
00:20:30.160 --> 00:20:37.440
through twenty twenty eight. Employers must track and report tips separately,

303
00:20:37.480 --> 00:20:40.039
so there's gonna be another box on your W two

304
00:20:40.079 --> 00:20:43.640
four out there now. The inditial provision to this tax

305
00:20:43.720 --> 00:20:47.759
on tips, and within ninety days of this bill's enactment,

306
00:20:48.200 --> 00:20:51.079
so ninety days from July fourth, the IRS is going

307
00:20:51.119 --> 00:20:56.319
to publish a list of qualifying occupations. So starting also

308
00:20:56.359 --> 00:20:59.599
in twenty twenty six, IRS withholding tables will be updated

309
00:20:59.640 --> 00:21:02.920
to refer like the new deduction, there's going to be

310
00:21:02.960 --> 00:21:06.799
a whole new employee deduction for those that are taxed

311
00:21:06.839 --> 00:21:13.279
on tips, and the bill expands the Social Security tip

312
00:21:13.480 --> 00:21:16.319
credit to cover beauty services.

313
00:21:15.759 --> 00:21:20.480
Such as hair and dale, spa and aesthetics services. These

314
00:21:20.480 --> 00:21:22.559
are fun things in these bills. I can't wait to

315
00:21:22.599 --> 00:21:25.559
see some of the other interpretations by the irs. Hey,

316
00:21:25.599 --> 00:21:27.759
we're gonna take a short break here and then we're

317
00:21:27.759 --> 00:21:32.319
going to talk about no tax on overtime. No tax

318
00:21:32.400 --> 00:21:34.039
on overtime. Right back in.

319
00:21:35.240 --> 00:21:38.920
We have only scratched the surface of today's show. Please

320
00:21:38.960 --> 00:21:42.200
stand by as Parry Chief Dowler will be right back

321
00:21:42.319 --> 00:21:48.240
with tax talk for you. As an owner operator, you

322
00:21:48.400 --> 00:21:51.960
already spend too much time away from your family. Trucker

323
00:21:52.039 --> 00:21:55.359
Tax Tools handles all your bookkeeping and taxes no matter

324
00:21:55.400 --> 00:21:58.079
what level trucker you are. Life on the road can

325
00:21:58.119 --> 00:22:01.720
be taxing, but that doesn't mean that your wallet or

326
00:22:01.839 --> 00:22:05.680
time with your family should suffer. Trucker Tax Tools makes

327
00:22:05.799 --> 00:22:09.559
your life run smoothly. Go to Trucker tax Tools dot

328
00:22:09.559 --> 00:22:12.079
com for a free guide that will give you the

329
00:22:12.200 --> 00:22:16.720
tools to never worry about your taxes again. Call Trucker

330
00:22:16.759 --> 00:22:20.880
Tax Tools eight seven seven nine sixty six two four

331
00:22:21.240 --> 00:22:24.960
seven seven, or go to Trucker tax tools dot com

332
00:22:25.000 --> 00:22:31.480
now and let the experts keep you trucking, let's get

333
00:22:31.480 --> 00:22:34.519
back to tax stock for you with more tax stock

334
00:22:35.079 --> 00:22:35.720
once again.

335
00:22:36.160 --> 00:22:38.720
Here's your host, Barry G. Faller.

336
00:22:41.160 --> 00:22:44.200
Hey, welcome back. Hey, speaking of trucking. If you're looking

337
00:22:44.240 --> 00:22:46.799
for somebody to help you your bookkeeping and your taxes

338
00:22:46.839 --> 00:22:49.240
and your trucker, Trucker tax tools this place to go

339
00:22:49.440 --> 00:22:54.039
to to Trucker tax tools dot com. Give them a call.

340
00:22:54.480 --> 00:23:00.880
Eight seven seven nine nine six two six seven. You know,

341
00:23:01.039 --> 00:23:05.640
talking about taxes, and you know, some of the things

342
00:23:05.640 --> 00:23:09.039
that we really were looking forward to see the interpretation

343
00:23:09.279 --> 00:23:16.319
by Congress and how they're going to implement the strategies

344
00:23:16.559 --> 00:23:23.119
and the plans that Trump is setting forth to lower

345
00:23:23.200 --> 00:23:27.599
your taxes. And one of the areas he promised was

346
00:23:27.759 --> 00:23:33.119
no tax on tips. You know, no tax on tips

347
00:23:33.720 --> 00:23:36.599
sounds great, and we're kind of waiting on the interpretation

348
00:23:36.680 --> 00:23:39.720
out here, because you know, we've read the bill and

349
00:23:39.839 --> 00:23:41.759
gone through the whole bill and we come up with

350
00:23:42.200 --> 00:23:45.759
what we think is no tax on tips, and then

351
00:23:46.839 --> 00:23:50.799
working with some of our associations out there, they come

352
00:23:50.920 --> 00:23:53.960
up with some other ideas what tax on no tax

353
00:23:54.240 --> 00:23:59.200
on overtime is I meant overtime not tips. The tips

354
00:23:59.240 --> 00:24:02.960
portion has been like out you know, really good out there,

355
00:24:02.960 --> 00:24:04.839
although we got to wait on the industries on here.

356
00:24:04.839 --> 00:24:08.160
But no tax on overtime. So here's what's in the bill.

357
00:24:08.279 --> 00:24:10.440
Taxpayers are going to be able to deduct the amount

358
00:24:10.480 --> 00:24:14.839
of overtime compensation received during the taxable year, provided the

359
00:24:14.880 --> 00:24:18.039
compensation is reported on either a W two or an

360
00:24:18.079 --> 00:24:23.119
information return per section six zero four one D four

361
00:24:23.799 --> 00:24:27.400
of the Big Beautiful Bill. Only over time that qualifies

362
00:24:27.480 --> 00:24:31.960
under Section seven of the Fair Labor Standards Act of

363
00:24:32.279 --> 00:24:36.039
nineteen thirty eight is eligible. We got to go all

364
00:24:36.039 --> 00:24:39.880
the way back to the Fair Labor Standards Act of

365
00:24:40.000 --> 00:24:43.839
nineteen thirty eight to determine what is eligible, so that

366
00:24:43.960 --> 00:24:48.000
is pay for hours worked in excess of the standard work.

367
00:24:48.039 --> 00:24:52.839
We calculated at a rate above the individual's hourly rate,

368
00:24:54.119 --> 00:25:01.400
so qualified overtime. Now there are two primary limitations. There's

369
00:25:01.440 --> 00:25:04.200
going to be a dollar amount cap and an income

370
00:25:04.359 --> 00:25:09.079
based phase out. First, the maximum deduction is twelve thousand,

371
00:25:09.160 --> 00:25:12.640
five hundred for single filers, twenty five thousand for married

372
00:25:12.680 --> 00:25:17.640
filing joint. Second, the deduction is gradually reduced for higher

373
00:25:17.680 --> 00:25:23.480
income taxpayers. So for every thousand dollars that you a

374
00:25:23.559 --> 00:25:28.519
taxpayer exceeds modified adjusted gross income of one hundred and

375
00:25:28.559 --> 00:25:32.160
fifty thousand for single three hundred thousand for married filing joint.

376
00:25:32.559 --> 00:25:37.000
That deduction is reduced by one hundred dollars. So if

377
00:25:37.039 --> 00:25:40.559
you're earning over one hundred and fifty thousand or over

378
00:25:40.599 --> 00:25:43.319
three hundred thousand married filing joint, you're going to see

379
00:25:43.319 --> 00:25:46.680
a reduction of one hundred dollars for every thousand you

380
00:25:46.759 --> 00:25:51.519
earn over That is a modified income. Again, this is

381
00:25:52.400 --> 00:25:56.880
taxable years only twenty twenty five through twenty twenty eight,

382
00:25:58.480 --> 00:26:02.759
and again it's only permitted when a taxpayer includes the

383
00:26:02.799 --> 00:26:07.319
recipient's Social Security number on the return, so there's some

384
00:26:08.039 --> 00:26:11.839
good things out there. The deduction, again is only available

385
00:26:11.880 --> 00:26:15.960
if you are married and married filing jointly. So now

386
00:26:16.279 --> 00:26:19.359
here's where the confusion comes in. There is one calculation

387
00:26:19.440 --> 00:26:23.000
where it takes your whole overtime. So if your hourly

388
00:26:23.079 --> 00:26:29.359
rate was twenty dollars an hour and your overtime pay

389
00:26:29.720 --> 00:26:33.880
is thirty dollars thirty times, however many hours of overtime

390
00:26:33.920 --> 00:26:38.279
you have, you're going to get the benefit of the

391
00:26:38.319 --> 00:26:41.279
full amount up to the twenty five thousand as long

392
00:26:41.279 --> 00:26:44.759
as you're below the threshold. The other side of this

393
00:26:44.920 --> 00:26:49.039
is people were coming in interpreting this to be that

394
00:26:49.240 --> 00:26:52.880
just the overtime portion of the rate would be where

395
00:26:52.880 --> 00:26:56.720
you would save it. So you worked, your rate is twenty,

396
00:26:56.920 --> 00:27:01.720
your overtime rate is thirty. Actual overtime rate is considered

397
00:27:01.720 --> 00:27:05.359
to be ten times however many hours you work, and

398
00:27:05.400 --> 00:27:08.319
then you would get the savings based on that. So

399
00:27:08.400 --> 00:27:10.920
if you work two hundred and fifty hours of overtime

400
00:27:11.039 --> 00:27:14.720
during the year, you would only save twenty five hundred dollars.

401
00:27:15.000 --> 00:27:17.559
So that's where people are going to get a little

402
00:27:17.559 --> 00:27:20.559
bit confused. We're waiting to see the interpretation of this,

403
00:27:21.160 --> 00:27:26.599
and because it's retroactive back to January one, twenty twenty five,

404
00:27:26.640 --> 00:27:30.599
there's going to have to be some adjustments in future

405
00:27:30.759 --> 00:27:33.079
W two forms this year and also going to have

406
00:27:33.119 --> 00:27:39.119
to be some adjustments to withholding tables, possibly through the

407
00:27:39.119 --> 00:27:41.279
rest of the year. Now they say they're going to

408
00:27:41.319 --> 00:27:43.960
start adjusting that withholding tables next year, which means you're

409
00:27:43.960 --> 00:27:46.799
probably going to over withhold this year and you'll see

410
00:27:46.839 --> 00:27:51.440
a larger refund due to the changes here. Now if

411
00:27:51.480 --> 00:27:56.119
you happen to be where your threshold modified adjust gross

412
00:27:56.160 --> 00:27:58.519
income is going to be above the one hundred and

413
00:27:58.519 --> 00:28:02.119
fifty or three hundred thousand. Starting in twenty twenty six

414
00:28:02.680 --> 00:28:07.400
when they have the adjusted withholding tables, you might have

415
00:28:07.480 --> 00:28:10.240
to adjust your withholding to make sure you cover enough money,

416
00:28:10.319 --> 00:28:12.559
especially if you're going to be subject to phase out.

417
00:28:12.880 --> 00:28:16.640
So let's say you're married and your spouse has a

418
00:28:16.759 --> 00:28:21.039
very good job and you know, maybe making somewhere in

419
00:28:21.079 --> 00:28:24.119
the six figures, and you're working at a job that

420
00:28:24.160 --> 00:28:27.519
you get tipped. You combine that and you're modified adjusted

421
00:28:27.559 --> 00:28:32.559
curse income goes above that three hundred thousand, and you've

422
00:28:32.559 --> 00:28:35.839
been withholding at a lower level, means you probably end

423
00:28:35.920 --> 00:28:38.799
up owing money when you come back to filing your

424
00:28:39.160 --> 00:28:42.920
capture turn. So you want to keep those things in mind.

425
00:28:44.720 --> 00:28:47.000
This is not going to be something that you're going

426
00:28:47.039 --> 00:28:50.799
to have to itemize. The deduction is supposed to be

427
00:28:50.920 --> 00:28:56.839
added to the standard deduction for non itemizers. IRS is

428
00:28:57.000 --> 00:29:02.759
authorized to regulate and prevent abuse a fun such as

429
00:29:03.279 --> 00:29:07.960
recategorizing wages as overtime. I can see that happening. I

430
00:29:07.960 --> 00:29:12.960
can see people doing that. Your w two's must report

431
00:29:13.200 --> 00:29:17.559
overtime separately in the laws. Also kind of said ten

432
00:29:17.680 --> 00:29:21.960
ninety nine's as well. But you're typically contracts, so I

433
00:29:22.000 --> 00:29:24.599
don't know how they're going to report overtime on ten

434
00:29:24.720 --> 00:29:30.359
ninety nine, but yet that's to be seen. And then

435
00:29:30.640 --> 00:29:33.160
you remember, this deduction is going to go away if

436
00:29:33.200 --> 00:29:36.480
you're twenty twenty eight. I really hate when they put

437
00:29:36.519 --> 00:29:38.599
things like that into this law. Why couldn't they just

438
00:29:38.640 --> 00:29:41.359
make it permanent so that people can understand it a

439
00:29:41.440 --> 00:29:46.839
little bit better going through this, you know, these tax

440
00:29:46.920 --> 00:29:49.559
laws and what they've put in place, and some of

441
00:29:49.599 --> 00:29:54.519
them being temporary. We have to be happy that the

442
00:29:54.559 --> 00:29:58.839
original Trump tax code has been made permanent. Now, how

443
00:29:58.839 --> 00:30:03.480
long does permanent last. Well, at some point somebody is

444
00:30:03.519 --> 00:30:06.720
going to take over both the House and the Senate

445
00:30:07.119 --> 00:30:10.400
and they're going to find a way, just like Trump did,

446
00:30:10.839 --> 00:30:15.759
to pass a new tax code. Something that will change again.

447
00:30:16.200 --> 00:30:19.200
But we can at least say, hey, this is going

448
00:30:19.240 --> 00:30:22.799
to be definitive for us over the next I have

449
00:30:23.519 --> 00:30:28.160
three years with these things in place, and after twenty

450
00:30:28.319 --> 00:30:31.440
twenty eight, we'll see what happens. Maybe they'll come in

451
00:30:31.480 --> 00:30:34.680
and make these permanent for the you know, senior deduction,

452
00:30:35.039 --> 00:30:38.960
for the overtime in the no tax on tips as well.

453
00:30:39.319 --> 00:30:42.079
Maybe they'll find a way to make those permanent out there,

454
00:30:42.480 --> 00:30:45.400
you know, it's kind of like, you know, they do

455
00:30:45.559 --> 00:30:49.720
need to find a way to reduce the debt, reduce

456
00:30:49.759 --> 00:30:52.480
the debt service. You know, part of that may be

457
00:30:52.680 --> 00:30:57.279
reducing the interest rates that the federal government pays, reducing

458
00:30:57.319 --> 00:31:00.359
interest that we pay so that we can get back

459
00:31:00.559 --> 00:31:04.759
to Hey, you know, maybe buying real estate at a

460
00:31:04.799 --> 00:31:09.440
reasonable rate, a reasonable interest rate and uh, you know,

461
00:31:09.640 --> 00:31:12.319
being able to qualify for a home and everything could

462
00:31:12.319 --> 00:31:15.440
all be important out there. Or even being able to

463
00:31:15.440 --> 00:31:19.559
buy a new car. Speaking of new cars, Hey, we're

464
00:31:19.559 --> 00:31:20.920
going to take a quick break and we're going to

465
00:31:20.960 --> 00:31:24.920
talk about deductible our loan interest, which is new in

466
00:31:24.960 --> 00:31:26.519
this tax code. We're right back.

467
00:31:27.599 --> 00:31:31.240
We have only scratched the surface of today's show. Please

468
00:31:31.279 --> 00:31:34.799
stand by as Barry Chief Fowler will be right back with.

469
00:31:35.000 --> 00:31:36.119
Tax talk for you.

470
00:31:38.799 --> 00:31:42.160
As an owner operator, you already spend too much time

471
00:31:42.160 --> 00:31:43.200
away from your family.

472
00:31:43.759 --> 00:31:45.799
Stop spending time doing paperwork.

473
00:31:46.279 --> 00:31:49.799
Go to Trucker tax tools dot com a solution filled

474
00:31:49.839 --> 00:31:54.000
specifically for truckers. Trucker tax tools dot Com makes your

475
00:31:54.079 --> 00:32:00.240
life run smoothly. Let's get back to tax talk for

476
00:32:00.319 --> 00:32:03.160
you with more Tax Dog once again.

477
00:32:03.599 --> 00:32:06.160
Here's your host, Barry G. Fallo.

478
00:32:08.440 --> 00:32:11.359
Hey, welcome, back. Hey, maybe you're in the market for

479
00:32:11.519 --> 00:32:16.799
a new car. Hey, gon Christ made deductible car loan

480
00:32:16.920 --> 00:32:21.640
interest for tax years twenty twenty five through twenty twenty eight.

481
00:32:22.119 --> 00:32:25.480
Interest paid in a loan the purchase of qualifying passenger

482
00:32:25.759 --> 00:32:31.759
vehicle for personal use may be deducted under a temporary provision. Now.

483
00:32:32.119 --> 00:32:37.200
To qualify, the loan must be incurred after December thirty one,

484
00:32:37.359 --> 00:32:40.960
twenty twenty four, and secured by a first lean on

485
00:32:41.119 --> 00:32:45.480
the vehicle. The interest is only deductible if the taxpayer

486
00:32:45.640 --> 00:32:50.880
includes the vehicle's identification number on their return. Refinancing of

487
00:32:50.960 --> 00:32:54.079
such loans is also eligible for the deduction, but only

488
00:32:54.119 --> 00:32:57.839
to the extent a refinanced amount does not exceed the

489
00:32:57.920 --> 00:33:03.640
original loan principle. Now, hey, we're subject to several exclusions.

490
00:33:05.200 --> 00:33:09.200
Interest on loans for fleet sales, commercial use, least vehicles,

491
00:33:09.240 --> 00:33:13.319
savage title vehicles, vehicles intended for scrap or parts is

492
00:33:13.359 --> 00:33:19.599
not deductible. Additionally, loans from related parties are excluded from eligibility.

493
00:33:20.000 --> 00:33:24.519
Deduction is capped at ten thousand OFT per taxable year.

494
00:33:24.599 --> 00:33:29.559
It's also phased out for higher income taxpayers. Now, if

495
00:33:29.559 --> 00:33:32.559
you're modified, adjust to gross income exceeds one hundred thousand

496
00:33:32.759 --> 00:33:36.160
or two hundred thousand for joints one hundred thousand single

497
00:33:36.200 --> 00:33:40.440
two hundred thousand dollars joint. Amazing, how these different levels here.

498
00:33:41.240 --> 00:33:45.200
Couldn't they have at least kept everything simple where the

499
00:33:45.240 --> 00:33:48.640
phase outs come in. If you do hit the phase

500
00:33:48.680 --> 00:33:51.839
out of MAUNT, it's going to be reduced by two

501
00:33:51.920 --> 00:33:56.039
hundred dollars for every thousand or part thereof. Don't know

502
00:33:56.039 --> 00:33:57.920
how they're going to accomplish this. You know, if you

503
00:33:58.000 --> 00:34:00.640
remember back we they one time talked by just having

504
00:34:00.640 --> 00:34:03.960
a postcard defile. That postcard has gotten expanded and expanded

505
00:34:03.960 --> 00:34:07.359
and expanded, is now a full page postcard and has

506
00:34:07.759 --> 00:34:11.400
schedules and subschedules, so you know, again, you know, we're

507
00:34:11.440 --> 00:34:13.559
making the tax codes a little bit more complicated than

508
00:34:13.679 --> 00:34:16.679
it's going to be simplified. And now it's become even

509
00:34:16.920 --> 00:34:21.559
more complicated on the return. So you know, we've got

510
00:34:21.559 --> 00:34:23.800
to watch how this is going to be put in.

511
00:34:23.880 --> 00:34:25.400
The Only way I can think is that they're going

512
00:34:25.440 --> 00:34:28.280
to have another schedule and then it'll go to Schedule

513
00:34:28.320 --> 00:34:31.480
one and then come over to the main tax return.

514
00:34:31.599 --> 00:34:33.920
Now we've got all the confusion out there about this.

515
00:34:34.559 --> 00:34:38.920
How have they defined a qualified vehicle. So the way

516
00:34:39.000 --> 00:34:42.119
this bill is defining, the qualified vehicle must be intended

517
00:34:42.119 --> 00:34:46.760
for the taxpayer's original use and primarily manufactured for use

518
00:34:46.840 --> 00:34:52.920
some public roads. Eligible vehicles includes powers, minivans, vans, SUVs,

519
00:34:52.960 --> 00:34:56.440
pickup trucks, motorcycles as long as they have at least

520
00:34:56.480 --> 00:35:00.519
two wheels and a gross weight rating under fourteen thousand pounds.

521
00:35:00.880 --> 00:35:03.679
Vehicle must also be classified as a motor vehicle under

522
00:35:03.719 --> 00:35:08.079
the Clean Air Act and assembled in the United States,

523
00:35:08.800 --> 00:35:13.320
not completely manufactured here, but has to be assembled here

524
00:35:13.599 --> 00:35:18.280
in the United States. This deduction is available to both

525
00:35:18.719 --> 00:35:23.199
people that itemize and those that do not itemize. So

526
00:35:24.000 --> 00:35:26.360
if you don't itemize, you're going to be able to

527
00:35:26.360 --> 00:35:31.800
claim the deduction as an above the line adjustment to incount. Now,

528
00:35:32.360 --> 00:35:35.280
if you're in business, one thing to be very clear,

529
00:35:35.840 --> 00:35:39.159
it does not this does not cover you in the business.

530
00:35:39.639 --> 00:35:46.119
The interest you still incur on business use vehicles still

531
00:35:46.400 --> 00:35:50.760
remains deductible for the percentage of business use of that

532
00:35:50.960 --> 00:35:55.079
vehicle on the business return associated with the use of

533
00:35:55.119 --> 00:35:58.920
that vehicle. So, if you buy a car or a

534
00:35:59.000 --> 00:36:03.039
truck or some vehicle that qualifies under what's the qualified vehicle,

535
00:36:03.440 --> 00:36:05.440
you're going to be able to dug the interest and

536
00:36:05.480 --> 00:36:10.280
appreciate that vehicle still on your business portion of the return,

537
00:36:10.800 --> 00:36:15.840
so that doesn't change for business purposes. This is only

538
00:36:15.880 --> 00:36:21.280
a change for individuals that are buying a vehicle or

539
00:36:21.440 --> 00:36:25.199
personal use. So does this benefits you if you were

540
00:36:25.199 --> 00:36:29.480
going out to refinance your current vehicle out there? Yes, no, Maybe,

541
00:36:29.719 --> 00:36:32.639
depends on where your mondified adjusted gross income is. Depends

542
00:36:32.639 --> 00:36:35.159
on what the change of the interest rate is as well.

543
00:36:35.559 --> 00:36:38.000
If you bought a vehicle several years ago and the

544
00:36:38.039 --> 00:36:40.840
interest rate was lower on your vehicle, you may not

545
00:36:40.960 --> 00:36:44.360
want to refinance because it may not benefit you. However,

546
00:36:44.519 --> 00:36:46.920
maybe you bought the vehicle within the last year, you

547
00:36:46.920 --> 00:36:49.599
bought it sometime in twenty twenty four, and you want

548
00:36:49.599 --> 00:36:51.880
to go in and refinance it. What we see in

549
00:36:51.880 --> 00:36:54.719
this book, as you in the bill, is that you

550
00:36:54.840 --> 00:36:58.039
may be able to go in and refinance. You've got

551
00:36:58.079 --> 00:37:01.079
to look at your mondified adjusted gross income and see

552
00:37:01.119 --> 00:37:03.559
if you're going to be subject to that phase out.

553
00:37:03.719 --> 00:37:06.880
So maybe you can reduce your interest rate by refinancing,

554
00:37:07.079 --> 00:37:09.079
or even if it adjusts your interest rate by a

555
00:37:09.159 --> 00:37:12.000
little bit, maybe you'll be able to write off take

556
00:37:12.039 --> 00:37:14.760
ten thousand dollars off the top. Now, taking that ten

557
00:37:14.800 --> 00:37:17.480
thousand off the top and you're only in a ten

558
00:37:17.519 --> 00:37:22.199
percent tax bracket saves you a thousand, but you may

559
00:37:22.239 --> 00:37:24.880
be paying more in interest because your interest rate may

560
00:37:24.920 --> 00:37:28.000
be going up. You may even pay less, So you

561
00:37:28.079 --> 00:37:29.599
got to kind of run the numbers. So have your

562
00:37:29.639 --> 00:37:33.559
tax preparer look at this with you and make the decision.

563
00:37:34.039 --> 00:37:39.599
Now with this, you need to really analyze how all

564
00:37:39.679 --> 00:37:44.960
these things impact you on your tax return. So I

565
00:37:45.000 --> 00:37:47.400
hope you have a good tax preparer who can go

566
00:37:47.440 --> 00:37:52.239
through this stuff. Changes to charitable contributions, so this bill

567
00:37:52.760 --> 00:37:55.840
had an amendment that applies a half a percent for

568
00:37:56.079 --> 00:37:59.320
against the sum of charitable contributions that a taxpayer makes.

569
00:38:00.239 --> 00:38:03.719
The amount of charitable contributions above this floor can be deducted.

570
00:38:04.039 --> 00:38:08.199
So Section one seventy b one states that an individual

571
00:38:08.280 --> 00:38:12.920
taxpayer may only deduct charitable contributions to the extent that

572
00:38:13.000 --> 00:38:18.199
the aggregate amount of your contributions exceeds half of percent

573
00:38:18.760 --> 00:38:23.559
of their contribution base, generally half a percent of your

574
00:38:23.559 --> 00:38:27.920
adjusted gross income. So that means you are not going

575
00:38:27.960 --> 00:38:30.440
to receive a tax benefit for the first half a

576
00:38:30.480 --> 00:38:35.760
percent of your contribution base donated to charity. The only

577
00:38:36.320 --> 00:38:40.960
amounts contributed beyond that thresholder eligible for a deduction subject

578
00:38:41.039 --> 00:38:48.000
to other existing percentage limitations charitable deductions. So you know,

579
00:38:48.400 --> 00:38:52.000
if you are rich, this is going to impact you

580
00:38:52.039 --> 00:38:55.679
more than if you have less income, because you've got

581
00:38:55.679 --> 00:38:58.199
to get over that floor of the half a percent.

582
00:38:59.559 --> 00:39:04.400
Section one seventy bash one that G was updated to

583
00:39:04.440 --> 00:39:06.960
clarify the sixty percent of just to gross income for

584
00:39:07.119 --> 00:39:12.000
cash contributions to public charities. The maximum deduction for cash

585
00:39:12.039 --> 00:39:15.159
contributions remain capped at sixty percent for the tax payers

586
00:39:15.199 --> 00:39:19.960
contribution base under sub Paragraphs A and G now coordinated

587
00:39:20.039 --> 00:39:25.480
explicitly to avoid exceeding combined deduction limits, ensuring consistency in

588
00:39:25.559 --> 00:39:29.760
applying percentage ceilings across different category. Many taxpayers aren't going

589
00:39:29.800 --> 00:39:33.199
to worry about this, aren't going to be impacted by this.

590
00:39:33.840 --> 00:39:36.480
You're going to see this impact mostly on the wealthy

591
00:39:36.639 --> 00:39:39.719
that are out there again trying to impact on the

592
00:39:39.760 --> 00:39:45.119
top one percent. Now, if you don't itemize this permanent

593
00:39:45.280 --> 00:39:50.199
charitable contribution deduction is available to you, Okay, So it

594
00:39:50.480 --> 00:39:54.760
reinstated and increase the above the line deduction limit for

595
00:39:54.880 --> 00:39:59.320
terrible contributions made by non itemizing individuals. Remember we had

596
00:39:59.320 --> 00:40:02.480
that six hundred doll deduction at one time. Now we're

597
00:40:02.480 --> 00:40:06.000
going to have a maximum deduction for single filers one

598
00:40:06.000 --> 00:40:10.639
thousand dollars above the line. If you're not itemizing married

599
00:40:11.280 --> 00:40:15.320
filing jointly, it's two thousand, and it's going to be

600
00:40:15.360 --> 00:40:18.519
applicable for years after twenty twenty five, So this is

601
00:40:18.519 --> 00:40:23.719
going to start twenty twenty six. So just remember that

602
00:40:24.199 --> 00:40:27.199
if you're an individual taxpayer, you're not going to be

603
00:40:27.199 --> 00:40:29.440
able to deduct the first half a percent of your

604
00:40:29.440 --> 00:40:34.800
contribution base. And so a good example here, taxpayer with

605
00:40:34.840 --> 00:40:37.960
one hundred thousand dollars of just gross income, you have

606
00:40:38.039 --> 00:40:42.000
to contribute five hundred dollars before any charitable deduction is allowed.

607
00:40:43.239 --> 00:40:46.360
Any disallowed contributions due to the new floor can be

608
00:40:46.440 --> 00:40:51.760
carried forward if total contributions succeed other applicable deduction limits,

609
00:40:51.760 --> 00:40:55.840
preserving the tax benefit future years. Taxpayers were smaller charitable

610
00:40:55.880 --> 00:41:00.280
giving patterns, or those with income volatility could see deducts

611
00:41:00.360 --> 00:41:04.119
reduced or eliminated in low income years. Planning to bundle

612
00:41:04.199 --> 00:41:08.559
donations in alternate years increases contribution levels and may help

613
00:41:08.760 --> 00:41:13.320
increase your tax benefits. So you know there are strategies

614
00:41:13.440 --> 00:41:15.920
you can use out here depending on your income levels

615
00:41:16.320 --> 00:41:21.280
to you know, group your contributions. Hey, remember, if you're

616
00:41:21.280 --> 00:41:24.360
a senior and you have required minimum distributions, so you

617
00:41:24.440 --> 00:41:26.719
have to take there is a way to make your

618
00:41:26.760 --> 00:41:32.159
required required minimum distributions directly to a charity to avoid

619
00:41:32.239 --> 00:41:35.800
taxability level. You know, there's a lot of things in

620
00:41:35.840 --> 00:41:38.880
this tax law. We've only scratched the surface.

621
00:41:39.440 --> 00:41:39.639
You know.

622
00:41:39.760 --> 00:41:41.719
Next week what we want to do is come back.

623
00:41:41.760 --> 00:41:47.039
We want to talk about QBI qualified business deductions. We

624
00:41:47.079 --> 00:41:51.559
want to talk about Trump's new accounts, the Trump accounts.

625
00:41:51.920 --> 00:41:56.760
We want to talk about lowering and expanding the salt

626
00:41:56.840 --> 00:42:00.719
limitation state in local tax I have twenty nine plans.

627
00:42:01.280 --> 00:42:04.599
All these things have changed, So we will try to

628
00:42:04.639 --> 00:42:07.440
fit some of these things in next week when we're

629
00:42:07.480 --> 00:42:12.360
talking about this one big beautiful bill business deductions and

630
00:42:12.400 --> 00:42:17.719
how it impacts businesses. But we'll continue to talk more

631
00:42:17.840 --> 00:42:21.320
about the different things that are in this bill that

632
00:42:21.440 --> 00:42:26.960
affects you and I on the individual level for tax payers. Hey,

633
00:42:27.400 --> 00:42:31.519
remember we're just scratching the surface of what this bill

634
00:42:32.119 --> 00:42:37.559
is going to do for you as the individual taxpayer.

635
00:42:38.119 --> 00:42:40.119
So there's a lot of good things in this bill.

636
00:42:40.599 --> 00:42:42.760
You just got to stay tuned. Hey, make sure you

637
00:42:42.800 --> 00:42:47.320
connect with us on Facebook. Find us at tax talkforu

638
00:42:47.440 --> 00:42:50.039
dot com. Go over there and like us, share it

639
00:42:50.039 --> 00:42:53.079
with your friends and family. Get this information out to everybody.

640
00:42:53.199 --> 00:42:57.559
This one big, beautiful bill helps most Americans across the board.

641
00:42:57.920 --> 00:43:01.280
It is something that can provide you a great way

642
00:43:01.480 --> 00:43:05.119
of saving money. How does this impact you? Come back

643
00:43:05.159 --> 00:43:08.679
next week a tax off for you again, like us

644
00:43:08.719 --> 00:43:12.239
on Facebook, share it on Facebook. Get the information out there,

645
00:43:12.239 --> 00:43:15.559
but tune in every Monday here at ten am Eastern

646
00:43:15.599 --> 00:43:19.519
time on tax Talk for You. You can also check

647
00:43:19.559 --> 00:43:24.679
out Taxation Solutions dot net, Taxation Solutions, tax Relief on Facebook,

648
00:43:25.000 --> 00:43:29.079
Trucker Tax Tools dot com, Trucker Tax Tools on Facebook.

649
00:43:29.360 --> 00:43:33.559
Connect with us learn more about what we can help

650
00:43:33.639 --> 00:43:37.159
you and how to help yourself save money on your

651
00:43:37.280 --> 00:43:40.679
taxes right here on tax Talk for You tax Talk

652
00:43:40.760 --> 00:43:43.719
for You dot com, W four Cy Radio. Thank you

653
00:43:43.800 --> 00:43:47.639
having guide blood glorious and awesome week, and we'll be

654
00:43:47.679 --> 00:43:48.480
back next week.

655
00:43:49.480 --> 00:43:52.639
Are you an individual or business that wants to understand

656
00:43:52.719 --> 00:43:56.039
taxes and how they affect you? Are you looking for

657
00:43:56.159 --> 00:44:01.559
specific tax advice for self employed business owners and truckers?

658
00:44:02.119 --> 00:44:06.199
Are you behind on taxes and your bookkeeping. Are you

659
00:44:06.320 --> 00:44:10.320
dealing with dirs and ready to have some relief, then

660
00:44:10.400 --> 00:44:14.039
you need Tax Talk for You, hosted by tax and

661
00:44:14.159 --> 00:44:16.159
trucker expert Barry g.

662
00:44:16.440 --> 00:44:17.639
Fouer EA.

663
00:44:17.679 --> 00:44:21.519
Tune in ten am Eastern Time every Monday right here

664
00:44:21.559 --> 00:44:25.079
on W four CY Radio and Talk for TV. Don't

665
00:44:25.079 --> 00:44:28.519
forget to check this and past episodes at tax.

666
00:44:28.320 --> 00:44:30.079
TALKFORU dot com.

667
00:44:30.559 --> 00:44:35.760
See you next week at W four cy dot com