Turn Tax Law Changes Into Opportunities: 2025 Key Figures
- POOJA SRIVASTAVA
- Nov 7, 2025
- 2 min read
Key New Deductions & Credits (2025–2028)
Provision | What’s New | Who Benefits |
Senior Bonus Deduction | Filers age 65+ can claim an additional standard deduction — $6,000 (Single) or $12,000 (MFJ). Phases out for MAGI > $75K / $150K. | Retirees, seniors |
Overtime Deduction | New above-the-line deduction up to $12,500 for qualified overtime compensation. | Middle-income earners |
Auto Loan Interest Deduction | New above-the-line deduction up to $10,000 for interest on qualified passenger-vehicle loans. Phases out for MAGI > $100K / $200K. | Individuals financing new vehicles |
SALT Cap Increase | State & Local Tax (SALT) deduction cap increased to $40,000 (Single or MFJ). Phase-out begins for MAGI > $500K ($250K MFS). | Itemizers, high-tax state residents |
Standard Deduction Boost | New indexed amounts: $15,750 (Single/MFS) · $23,625 (HOH) · $31,500 (MFJ) | All taxpayers |
Child Tax Credit Expansion | Credit increased to $2,200 per child; eligibility rules expanded. | Families |
Charitable Contribution Adjustments | Non-itemizers: up to $1,000 (Single) / $2,000 (Married). Itemizers: limit of 0.5% of AGI. | All donors |
Tax-Free Tips & Overtime | Certain tips (up to $25,000) and overtime income excluded from federal tax (2025–2028). | Service & hourly workers |
Standard Deduction Changes
Filing Status | 2024 | 2025 | Increase |
Single | $14,600 | $15,750 | $1,150 |
Married Filing Separately | $14,600 | $15,750 | $1,150 |
Married Filing Jointly / Qualifying Widow(er) | $29,200 | $31,500 | $2,300 |
Head of Household | $21,900 | $23,625 | $1,725 |
Marginal Tax Rates – Tax Year 2025
Rate | Single Income Over | Married Filing Joint Income Over |
37% | $626,350 | $751,600 |
35% | $250,526 | $501,051 |
32% | $197,301 | $394,601 |
24% | $103,351 | $206,701 |
22% | $48,476 | $96,951 |
12% | $11,926 | $23,851 |
10% | Up to $11,925 | Up to $23,850 |
Retirement Plan Contribution Limits (2025)
Account Type | 2024 Limit | 2025 Limit | Age 50+ Catch-Up (2025) | Total (50+) |
401(k) / 403(b) / 457 Plans | $23,000 | $23,500 | $7,500 | $31,000 |
Traditional IRA | $7,000 | $7,000 | $1,000 | $8,000 |
Roth IRA | $7,000 | $7,000 | $1,000 | $8,000 |
SIMPLE IRA | $16,500 | $16,500 | $3,500 | $20,000 |
Other Key 2025 Tax Changes
Category | 2025 Change |
Capital Gains Tax Thresholds | 0% rate up to $48,350 (single) / $96,700 (MFJ); 15% up to $533,400 (single) / $600,050 (MFJ) |
FSA Contribution Limit | $3,300 (max) with $660 carryover option |
HSA Contribution Limit | $4,300 (self-only) / $8,550 (family); $1,000 catch-up (age 55+) |
Foreign Earned Income Exclusion | Increased to $128,200 |
Estate Tax Exclusion | Increased to $13.99 million |
Gift Tax Exclusion | Increased to $19,000 per individual |
Business Mileage Rate | $0.67 per mile |
Medical / Moving Mileage Rate | $0.21 per mile |
Charitable Mileage Rate | $0.14 per mile |
Child Tax Credit (2025)
Per Qualifying Child | $2,000 |
Refundable Portion (Additional CTC) | Up to $1,600 (subject to income phase-outs) |
Health & Savings Phase-Out Ranges
Account Type | Filing Status | 2025 Phase-Out Range |
Roth IRA | Married Filing Jointly | $236,000 – $246,000 |
Roth IRA | Single / HOH | $150,000 – $165,000 |
IRA Deduction | Covered by Plan (MFJ) | $123,000 – $143,000 |
IRA Deduction | Single / HOH | $77,000 – $87,000 |
Alternative Minimum Tax (AMT)
Filing Status | 2024 Exemption | 2025 Exemption | Phase-Out Begins |
Married Filing Jointly | $133,300 | $137,000 | $1,220,000 |
Single / HOH | $85,700 | $88,300 | $609,350 – $978,750 |
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