February 2025: Your Comprehensive US Tax Update [links included]

IRS Urges Caution in Choosing Tax Preparers to Avoid Scams

The IRS advises taxpayers to choose tax professionals wisely to avoid fraud and identity theft, offering tools like the Directory of Federal Tax Return Preparers. Key tips include checking for a valid PTIN and avoiding “ghost” preparers. 

Read the article here- IRS urges taxpayers to choose tax preparers carefully to protect their personal information | Internal Revenue Service

IRS Recommends Online Tools for Faster Service 

The IRS encourages taxpayers to use IRS.gov for quicker service during Presidents Day weekend, offering tools for refund tracking, filing, and tax help. 

Read the article here- Don’t wait on hold; use IRS online tools for faster help | Internal Revenue Service

IRS Offers Key Tax Updates and Resources for 2024 Filing Season 

The IRS advises taxpayers to prepare early for the 2024 tax season, highlighting key updates such as increased child tax credits, new 1099-K reporting thresholds, and higher IRA contribution limits. Taxpayers can use IRS tools like Free File and Direct File for accurate, timely filings. 

Read the article here- Tax Time Guide 2025: Essentials needed for filing a 2024 tax return | Internal Revenue Service

IRS Reminds Farmers and Fishers of March 3 Tax Deadline; Disaster Areas Have Extended Time 

Farmers and fishers who skipped January’s estimated tax payments must file their 2024 federal income tax returns by March 3, 2025, to avoid penalties. Taxpayers in disaster areas, including parts of several states, have until May 1, 2025, to file and pay, with further extensions available upon request. 

Read the article here- https://www.irs.gov/newsroom/irs-many-farmers-and-fishers-face-march-3-tax-deadline-disaster-areas-have-more-time

Disaster Relief- IRS Announces Tax Relief for Kentucky Residents Affected by Severe Storms 

The IRS is offering tax relief to individuals and businesses in Kentucky impacted by severe storms, flooding, and landslides starting February 14, 2025. Affected taxpayers now have until November 3, 2025, to file returns and make payments for various tax obligations, including individual, business, and payroll taxes.

Read the article here- https://www.irs.gov/newsroom/irs-announces-tax-relief-for-taxpayers-impacted-by-severe-storms-straight-line-winds-flooding-and-landslides-in-kentucky-various-deadlines-postponed-to-nov-3 

News from President’s Desk 

House Passes Budget Resolution for Major Tax Cuts and Spending Reductions 

On February 25, 2025, the House approved a budget resolution proposing $4.5 trillion in tax cuts over 10 years, contingent on $2 trillion in spending cuts. The resolution also includes a plan to raise the federal debt ceiling by $4 trillion. The Senate’s budget focuses on defense, border spending, and energy production but excludes tax cut provisions.

Read the article here- https://www.pwc.com/us/en/services/tax/library/house-approves-budget-resolution-reconciliation-tax-spending-reforms.html  

Trump’s Tax Proposal: No Taxes on Tips and Overtime

The House Republicans are attempting a high-stakes budget manoeuvre to extend Trump’s tax cuts and support campaign promises like no tax on tips and overtime, while requiring $2 trillion in spending cuts over a decade. This ambitious budget framework faces critical challenges in identifying savings and securing legislative approval, potentially risking the full implementation of promised tax relief. 

Read the article here-  https://www.forbes.com/sites/shaharziv/2025/02/27/trumps-no-tax-on-tips-no-tax-on-overtime-could-hinge-on-this/