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🚗 2025 Vehicle Purchasers — Important Tax Update for Personal Use Vehicles in Preparing Your 2025 Income Tax Return

If you purchased a new vehicle in 2025, the recently passed One Big Beautiful Bill created a new deduction for qualified vehicle loan interest that may reduce your taxable income for 2025.

Key qualifying details:

* Vehicle must be new (not used) and purchased (not leased) in 2025
* Vehicle must have final assembly in the United States (VIN typically starts with a 1, 4, or 5)
* Loan must be a qualified auto loan in your name
* Deduction is subject to income limits and other eligibility rules
* Only the interest portion of loan payments may qualify

Items needed for tax preparation:

*Vehicle Identification Number (VIN)
* Purchase documents showing the vehicle was new and purchased in 2025
* Confirmation that final assembly occurred in the U.S. (VIN codes beginning with 1, 4 ,or 5)
* Year-end or monthly loan interest statement from your lender (may receive a Form 1098-VIL)
* Loan start date and borrower(s) listed on the note

One Big Beautiful Bill Act: "No Tax on Overtime"

From IRS Fact Sheet FS-2025-3..

Effective for 2025 through 2028, individuals who receive qualified overtime compensation may deduct the pay that exceeds their regular rate of pay - such as the “half” portion of
“time-and-a-half” compensation — that is required by the Fair Labor Standards Act (FLSA) and that is reported on a Form W-2, Form 1099, or other specified statement furnished to the individual.

Maximum annual deduction is $12,500 ($25,000 for joint filers).

Deduction phases out for taxpayers with modified adjusted gross income over $150,000 ($300,000 for joint filers).

Taxpayer eligibility: Deduction is available for both itemizing and non-itemizing taxpayers.

Taxpayers must:
▪ include their Social Security Number on the return and
▪ file jointly if married, to claim the deduction.

Reporting: Employers and other payors are required to file information returns with the IRS (or SSA) and furnish statements to taxpayers showing the total amount of qualified overtime compensation paid during the year.

Guidance: The IRS will provide transition relief for tax year 2025 for taxpayers claiming the deduction and for employers and other payors subject to the new reporting requirements.

One Big Beautiful Bill Act: "No Tax on Tips"

From IRS Fact Sheet FS-2025-3...

Effective for 2025 through 2028, employees and self-employed individuals may deduct qualified tips received in occupations that are listed by the IRS as customarily and regularly receiving tips on or before December 31, 2024, and that are reported on a Form W-2, Form 1099, or other specified statement furnished to the individual or reported directly by the individual on Form 4137.

“Qualified tips” are voluntary cash or charged tips received from customers or through tip sharing.

Maximum annual deduction is $25,000; for self-employed, deduction may not exceed individual's net income (without regard to this deduction) from the trade or business in which
the tips were earned.

Deduction phases out for taxpayers with modified adjusted gross income over $150,000 ($300,000 for joint filers).

Deduction is available for both itemizing and non-itemizing taxpayers.

Self-employed individuals in a Specified Service Trade or Business (SSTB) under section 199A are not eligible. Employees whose employer is in an SSTB also are not eligible.

Taxpayers must:
▪ include their Social Security Number on the return and
▪ file jointly if married, to claim the deduction.

Reporting: Employers and other payors must file information returns with the IRS (or SSA) and furnish statements to taxpayers showing certain cash tips received and the occupation of the tip recipient.

Guidance: By October 2, 2025, the IRS must publish a list of occupations that “customarily and regularly” received tips on or before December 31, 2024.

The IRS will provide transition relief for tax year 2025 for taxpayers claiming the deduction.

Growing your business right here in our small town doesn't have to be complicated. Here's a friendly reminder of four simple ways to make it happen:

1️⃣ Invite New Faces: Spread the word, connect at local events, and welcome new customers into your community.
2️⃣ Offer a Little Extra: Encourage folks to grab that extra pie or service—they’ll appreciate your thoughtful suggestions!
3️⃣ Come Back Soon: Create reasons for your customers to drop by more often. Loyalty programs and hometown deals go a long way.
4️⃣ Fine-tune Your Operation: Small changes like reducing waste, watching expenses, and improving efficiency keep profits healthy.

🌟 Remember: Growing your business means strengthening our whole community. We’re all in this together!