by David A. Snyder, CPA, Managing Member, David A. Snyder CPA, PLLC
The tax year 2025 adjustments described below generally apply to income tax returns to be filed starting tax season 2026. The tax items for tax year 2025 of greatest interest to many taxpayers include the following dollar amounts:
Standard deductions
For single taxpayers and married individuals filing separately for tax year 2025, the standard deduction rises to $15,000 for 2025, an increase of $400 from tax year 2024. For married couples filing jointly, the standard deduction rises to $30,000, an increase of $800. For heads of households, the standard deduction will be $22,500 for tax year 2025, an increase of $600 from the amount for 2024.
Marginal rates
For tax year 2025, the top tax rate remains 37% for individual single taxpayers with incomes greater than $626,350 ($751,600 for married couples filing jointly). The other rates are:
35% for incomes over $250,525 ($501,050 for married couples filing jointly).
32% for incomes over $197,300 ($394,600 for married couples filing jointly).
24% for incomes over $103,350 ($206,700 for married couples filing jointly).
Unchanged for tax year 2025
• Personal exemptions for tax year 2025 remain at 0, as in tax year 2024.
• Itemized deductions. There is no limitation on itemized deductions for tax year 2025, as in tax year 2024 and preceding, to tax year 2018.
• Lifetime learning credits. The modified adjusted gross income amount used by taxpayers to determine the reduction in the Lifetime Learning Credit provided in Sec. 25A(d)(1) of the Internal Revenue Code is not adjusted for inflation for taxable years beginning after Dec. 31, 2020. The Lifetime Learning Credit is phased out for taxpayers with modified adjusted gross income in excess of $80,000 ($160,000 for joint returns).
Arizona tax changes effective
Jan. 1, 2025
Residential property owners who rent their properties via long-term lodging venues will no longer be required to collect and remit local-level transaction privilege taxes (TPTs) on the income derived from long-term lodging stays of 30 days or more. Owners of rental properties are required to cease charging tenants the amount of the repealed tax.
