TAX BULLETIN – Tax Tips, News, & Updates: Issue No. 4 | Vol No. 1
We at SSCPA Consulting want to send our best wishes to you (our clients, peers, business partners, and colleagues) and your families. We are certainly looking forward to a blessed and successful 2026. The next series of issues No. 4 (2026) will focus on Tax related aspects of the One Big Beautiful Bill Act! This volume No. 1 (newsletter) focuses on the “no tax on overtime” and additional $6,000 deductions for seniors. It also features our opinion on these issues.
2026 Tax Deductions Provided by the OBB HR1:
The central focus of the legislative tax proposal known as the “One Big Beautiful Bill” (OBBB) passed into law by Congress and signed into law by Pres makes several portions of the prior Trump’s Administration’s 2017 Tax Cuts and Jobs Act (TCJA) permanent. Including a very low rate of income tax for big businesses.
Overtime Tax Information: Individuals may be eligible to deduct for qualified overtime. The Act allows Taxpayers who earn wages up to $12,500 $25,000 for joint filers for overtime work, which is included in their gross pay, to lower their tax lability!
Other deductions for 2026 filing season: A deduction is an amount subtracted from the taxpayer’s income when filing. Deductions lower the taxable income resulting in lowering the federal income tax liability, if any. See below; the “Devil is always in the Details!” An increase in deductions for seniors aged 65 and older may be eligible to claim an additional $6,000 deduction. Among several other new tax deductions that have been introduced for the 2026 filing season is that individuals may deduct up to $10,000 in qualified passenger vehicle loan interest.
HR1 OBBB Deductions Caveat
As passed by the House, Section 110101 of H.R. 1. The “One Big Beautiful Bill” All new or enhanced deductions are available for both itemizing and non-itemizing taxpayers. Each of these deductions phase out based on income level for individual and joint filers and have specific eligibility requirements.
The Devil is in the Details: As with all other packages, the devil is always in the details. While the OBBB package allows for tax on overtime pay, this only applies to the half-time portion of the pay earned NOT the full overtime pay. Regarding the deductions for seniors, most seniors who are retired do not have much tax liability to benefit from that $6,000 deduction. All these deductions phase out for taxpayers with modified adjusted gross income over $150,000 ($300,000 for joint filers)
Other things to note about this controversial Bill are:
- One of the main tenets of the Bill is that is permanently extends the 2017 Tax Cuts and Jobs Act (TCJA), which was set to expire at the end of this 2025 unless Congress acted.
- In addition to the tax policies the Bill includes significant changes to immigration, energy, healthcare, and so-called “safety net programs” such as Medicaid.
- Projections from the Congressional Budget Office (CBO) and independent analysts estimate that Trump’s OBBBA will add from $3.3 trillion to $4.5 trillion to the national debt in the next decade.
Reactions to the Bill
Results of independent research and analyses from several organizations have suggested that most of the benefits of this Bill skew toward the wealthy. Kiplinger also reported on the results of their opinion polls on this Bill. They conclude that more Americans oppose than support the big bill.
Business Taxes for C-Corps; S-Corps; Partnerships are due by March 15, 2026!
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WE HOPE YOU ENJOYED & LEARNED FROM THIS MONTH’S BULLETIN!
Contact us for more information which is specific to your situation as there are always exceptions to the IRS rules and specific to the states’ rules!
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