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00:00 Speaker A
With age-old myths still puzzling American filers, there are several new tax rules, too, largely coming from President Trump’s big beautiful bill. Emma Ackerman joins me to unpack what you need to know before your taxes are due on April 15th. Emma, what do I need to know?
00:15 Emma Ackerman
A lot. I mean, filing your taxes has never been accused of being easy, but like you said, with the passage of the One Big Beautiful Bill Act last year, there are a lot of new provisions to consider. Um, so some of those can, you know, save you some money down the line. One, you’ve got an increase to the standard deduction. We’ve also got a new deduction for folks over the age of 65, which is about $6,000, known as the senior deduction.
00:41 Emma Ackerman
We’ve got an increase to the state and local tax deduction for our itemized filers out there. So that’s gone from 10,000 to 40,000. Um and you’ve probably heard the popular provisions known as no tax on tips and no tax on overtime. It’s a little bit more complicated than the title suggests.
01:00 Speaker A
It sounds so simple.
01:01 Emma Ackerman
It sounds so simple, but you can deduct up to $25,000 of uh your tips from your taxable income. Of course, you still owe, you know, Medicare taxes, social security taxes, uh state and local taxes. And then for overtime, it’s up to uh $12,500 of overtime pay that you can deduct. And there’s some other stuff in there too, increase in the child tax credit, um, and you can also deduct uh auto loan interest for made in America vehicles, so vehicles that had final assembly in the US. And there’s others too that I’m probably not thinking of right now.
01:38 Speaker A
All right, so nothing’s simple. Let me ask you this. What what what can we expect in terms of refunds this year?
01:43 Emma Ackerman
So, because of all of the uh provisions that I just mentioned, refunds are expected to be bigger and that is probably good news for some people watching who may have been focused on the buzzword affordability in the past year. Um, so where refunds have uh trended near 3,000 on average in recent years, this year we’re looking at closer to 4,000. Um so a bit of extra cash in your pocket, whether that’s to cover higher grocery bills, um or maybe tuck away into savings, which of course, the folks that I spoke to always suggest.
02:20 Speaker A
Emma, great to see you. Thank you.
02:21 Emma Ackerman
Great to talk.