New and Enhanced Deductions for Individuals

The Internal Revenue Service (IRS) recently announced updates highlighting new and enhanced deductions available to individual taxpayers. As tax professionals, staying ahead of these changes allows us to provide proactive guidance, maximize client refunds, and ensure accurate compliance.

Below is a breakdown of key areas that may impact your clients this filing season.

1. Expanded and Adjusted Standard Deduction Amounts

The standard deduction continues to increase, helping many taxpayers reduce taxable income without itemizing. For many clients — especially those with simpler returns — the higher standard deduction may provide the greatest benefit.

What this means for preparers:

• Re-evaluate whether itemizing still provides value.

• Compare state-level itemized benefits where applicable.

• Clearly communicate to clients why itemizing may no longer be advantageous.

  
  

2. Enhancements to Above-the-Line Deductions

Certain “above-the-line” deductions can reduce adjusted gross income (AGI), which may also improve eligibility for credits and other tax benefits.

These can include:

• Educator expenses

• Student loan interest

• HSA contributions

• Self-employed retirement contributions

  
  

Lowering AGI remains a powerful tax planning strategy, especially for clients near phase-out thresholds.

3. Charitable Contribution Considerations

Even in years where most taxpayers take the standard deduction, certain charitable contribution rules may still offer planning opportunities.

Encourage clients to:

• Maintain proper documentation

• Consider “bunching” contributions when beneficial

• Explore donor-advised funds if appropriate

  
  

Proactive planning conversations now can help clients optimize future tax years.

4. Self-Employed and Gig Worker Opportunities

With continued growth in gig and contract work, many taxpayers qualify for deductions they may not fully understand.

Key areas to review:

• Qualified Business Income (QBI) deduction

• Home office deduction

• Mileage and vehicle expenses

• Business insurance and professional fees

  
  

Clear documentation and organized bookkeeping are essential to maximizing these deductions while minimizing audit risk.

5. Credits That Interact With Deductions

Some deductions can directly impact eligibility for major credits, including:

• Premium Tax Credit

• Education credits

• Child-related credits

  
  

Strategic planning around income timing and deductions can significantly affect a client’s overall tax outcome.

Why This Matters for Tax Professionals

Tax law updates create opportunity — not just compliance work.

As preparers, our role goes beyond entering numbers. It includes:

✔ Educating clients on new opportunities

✔ Identifying overlooked deductions

✔ Planning ahead for future tax years

✔ Leveraging technology to ensure accuracy

Using professional software like MyTAXPrepOffice that keeps pace with IRS changes helps ensure that you don’t miss valuable deductions your clients are entitled to claim.

Final Thoughts

The latest updates from the IRS serve as a reminder that tax law is always evolving. By staying informed and proactively reviewing client situations, tax professionals can continue to deliver meaningful value — not just during filing season, but year-round.

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Disclaimer: This article is for informational and educational purposes only and does not constitute legal tax advice. Advanced Tax Solutions is not liable or responsible for any damages resulting from or related to your use of this information. It is your responsibility to refer to official IRS documentation for information regarding any tax laws or tax information shown here.