Good morning. They say that taxes are one of only two certainties in life. But right now,
there’s actually a lot of uncertainty surrounding taxes. You definitely still have to pay
them, but 2025 is expected to be a year of big tax changes. So, whether you got your taxes
in earlier this week as soon as the window opened or you’ll be running through the post o
ffice doors at 11:59pm on April 15, let us show you what’s on the horizon so you can be ev
en more prepared by the time next year’s tax season rolls around.—ARThe IRS began acceptin
g 2024 tax returns this week, commencing the season when accountants forget what their kid
s look like race to help Americans file by April 15. And while there are some changes for
2024, congressional lawmakers are already looking ahead to future tax seasons—with 2025 se
t to go down in history as the year of a major tax overhaul.What will Congress be squabbli
ng over? Several provisions of the sweeping tax reform passed during President Donald Trum
p’s first term in 2017, known as the Tax Cuts and Jobs Act (TCJA), are set to expire on th
e last day of the year, and lawmakers will be duking it out over which ones to extend. Con
gress will also consider a wishlist of additional tax reductions that Trump and his allies
want passed.Saving Trump’s tax cutsTrump and most Republicans in Congress—who comprise a
narrow majority of both chambers—are expected to favor extending the law. The cuts lowered
the tax bill for many Americans (disproportionately benefitting wealthier ones) and US co
rporations, which economists say led to an economic growth bump but not enough to offset t
he hit to the government budget.Through the provisions set to expire on December 31, 2025,
the TCJA:Lowered the tax rate on five out of seven income brackets.Doubled the child tax
credit (Democrats supported increasing it further) and made higher-income families eligibl
e for it.It also doubled the standard deduction that exempts a chunk of a filer’s income f
rom taxation.And in a boon to wealthy heirs, it increased the amount exempt from federal i
nheritance taxes from $5.6 million to $11.2 million per person (now nearly $14 million aft
er indexing for inflation).If any of the measures from the TCJA expire, at least 62% of ta
xpayers would be on the hook for a higher tax bill starting in 2026, according to estimate
s by the right-leaning Tax Foundation think tank.There’s no such thing as free tax cuts…as
keeping TCJA past 2025 could sap $4.6 trillion from federal coffers over the following de
cade, according to the nonpartisan Congressional Budget Office. To compensate, lawmakers w
ould likely have to cut spending, and getting agreement on what cuts to make could prove t
ricky, especially given Republicans’ slim majorities in Congress.—SK