718-863-8644 info@metrotaxusa.com

December watch: IRS spotlights tax security; automatic penalty relief on deck

by | Jan 14, 2026 | Tax Tips and News

It’s holiday shopping season. It’s also the warm-up for tax season. Two quick updates to know this December.

Security push this week

The IRS and state tax agencies are using early December to promote National Tax Security Awareness Week. The message is simple: thieves want your tax refund and your identity. Don’t make it easy.

  • Be suspicious of emails and texts claiming to be from the IRS. The IRS doesn’t start contact by email, text, or social media DMs about a bill or refund.
  • Turn on two-factor authentication for tax software and financial accounts.
  • Use strong, unique passwords. Consider a password manager.
  • Avoid public Wi‑Fi for anything sensitive. Hotspot or wait until you’re on a secure network.
  • Update your phone, computer, and apps to patch security holes.
  • Watch for “smishing” and “vishing.” Don’t click unknown links, and don’t read off codes to callers.

Bonus: If you choose to use an Identity Protection PIN, store it somewhere safe. You’ll need it to e-file.

Automatic first-time penalty relief coming in 2026

The IRS says it plans to start applying First-Time Abate Relief automatically next year for about 1 million taxpayers. That means certain late-filing or late-payment penalties may be removed without you having to ask, if you have a clean recent history.

What to expect: If a qualifying penalty posts, the system should reverse it. Keep any IRS notices you receive, and watch your account for updates.

For small businesses

  • Security tips apply to payroll and bookkeeping systems, too. Protect access to payroll portals and cloud accounting tools.
  • January brings tight filing windows for W‑2s and 1099s. Start gathering info now to avoid last‑minute scrambles.

This article is for general information only and is not legal, financial, or tax advice.

– Article provided by Tax News.

Tax Season 2026 Kickoff: What Changed and What to Do in January

by | Jan 14, 2026 | Tax Tips and News

It’s tax time again. Forms are arriving. Logins are unlocking. Coffee is brewing. Here’s a quick, practical rundown of what matters for your 2025 return (filed in 2026) and a few simple steps to make filing smoother.

New and notable this season

One, Big, Beautiful Bill Act: Tax deductions for working Americans and seniors

  • “No tax on tips” (qualified tip income deduction):
    A new above-the-line deduction allows eligible workers to deduct qualified tip income for tax years 2025 through 2028, even if they take the standard deduction. Tips are still taxable and must be reported, but income limits, annual caps, and employer reporting rules apply.
  • “No tax on overtime” (qualified overtime pay deduction):
    Eligible taxpayers can deduct certain qualified overtime pay, generally the premium portion required by federal labor law. This is an above-the-line deduction with income phaseouts and reporting requirements, not a full exclusion of overtime from tax.
  • “No tax on car loan interest” (qualified vehicle loan interest deduction):
    For 2025 through 2028, taxpayers may deduct up to $10,000 of interest paid on a qualifying loan for a new, personal-use vehicle, even if they do not itemize. The loan, vehicle, and taxpayer must meet specific requirements, and the deduction phases out at higher income levels.
  • Additional deduction for seniors (age-based additional deduction):
    Taxpayers age 65 and older may qualify for a new additional deduction through 2028, on top of the existing senior standard deduction. This benefit is income-limited and applies whether or not you itemize.

Other important filing updates (not part of the Act)

  • Marketplace health insurance (Premium Tax Credit reconciliation):
    If you had coverage through a state or federal marketplace in 2025, you must wait for Form 1095-A and reconcile any advance Premium Tax Credit on your return. Filing without it or using estimates can delay processing or cause corrections.

Watch your mailbox (and inbox)

Most tax forms land by the end of January. Some arrive later. Common ones to look for:

  • W-2 from your employer
  • 1099-NEC/1099-MISC for freelance or gig income
  • 1099-INT/1099-DIV for bank and investment income
  • 1099-B or a consolidated investment statement (often comes in February, and corrected versions can follow)
  • 1095-A for marketplace health coverage (essential if you got advance credits)

Match the name and Social Security number on your forms to your return. If you moved in 2025, make sure companies have your new address so forms don’t go missing.

Refund timing reminders

  • Electronic filing with direct deposit is generally the fastest route.
  • If you claim the Earned Income Tax Credit or the Additional Child Tax Credit, federal law typically delays those refunds until at least mid-February. That’s normal.
  • Simple, accurate returns move quicker. Double-check Social Security numbers, bank info, and any dependent details before you hit “submit.”

Simple prep moves that help

  • Create a single folder (digital or paper) and drop every tax form into it as it arrives.
  • Save year-end statements for savings, investments, student loans, and mortgages. Interest and dividend totals often show up there.
  • Wait for corrected investment forms if your broker warns one is coming. Filing once is better than filing twice.
  • Have last year’s return handy. You’ll need numbers like your prior-year AGI to e-file.

For small-business owners and gig workers

  • New mileage rate for 2026: The IRS set the 2026 standard mileage rate for business use at 72.5 cents per mile starting January 1, 2026. That matters for the miles you’re logging now for next year’s return.
  • Interest expense rules: The IRS updated FAQs on the business interest limitation under the new law. If interest is a big line item in your books, watch for how those changes affect your deduction.

Keep an eye on announcements

The IRS typically releases more filing-season details in January, including updates on forms, credits, and processing times. A quick check before you file can save time later.

 

Disclaimer: This article is for general information only and is not legal, financial, or tax advice.

– Article provided by Tax News.