Welcome to Tax Week, a weeklong series of guides and resources for the 2025 tax season.
If your financial situation hasn't changed much since this time last year, that could translate to good news in terms of sorting out your taxes: Little in the tax code has changed, either.
On the other hand, now might be the time to advocate for future changes, said Navy veteran and tax pro Kevin Matthews, as provisions in place since 2018 approach their eight-year expiration after 2025.
Matthews, owner of Beta Solutions CPA and a professor of accounting at George Mason University in Virginia, used a Feb. 19 webinar presented by the Military Officers Association of America to reinforce the fundamentals of tax filing amid a lull in year-to-year changes in the tax code. He also provided a glimpse of possible changes on the horizon, including tax cuts enacted under President Donald Trump during his first administration that are due to expire in the near future.
Here's what to keep in mind when filing your taxes this year, according to Matthews:
Genuine April 15 Filing Deadline
April 15 falls on a Tuesday this year, so unlike certain years in the recent past, no combination of weekends or local holidays will delay the inevitable. Mailed returns must be postmarked by April 15 and electronic filing completed before midnight in your time zone.
Combat zone exception: Service members deployed to combat zones, of course, have some extra time. They can extend filing and payment, without penalties, by 180 days from the day they left the combat zone, plus however many days they served in the combat zone during the calendar year prior to April 15, according to information on the IRS's website. For example, a service member who entered a combat zone March 1 would get a 226-day extension from the date of leaving the combat zone.
Six-month extensions: Any taxpayer can get a six-month extension on filing their tax return if they make a payment of any amount at www.irs.gov/payments and indicate, where provided, that the payment is for an extension.
But Matthews warned that the extension applies only to the tax return -- in other words, the paper or electronic form -- and not the payment itself. Late payments will nevertheless accrue penalties, so "get the best estimate you can with what you've got, and pad it a little bit," he said. "Be sure that you get the payment done so that you don't incur any additional failure-to-pay penalty."
Guarding Against Lost Documentation
Mailing paper documents carries the real risk that the IRS will misplace or lose them -- or even apply your payment to the wrong account.
Matthews said his favorite way to mail paperwork to the IRS is by priority mail, which includes free tracking. "That way, you can prove to the IRS, 'We mailed this to you, [and] when you want to come back to us and say that we didn't send something, here's where it is.'" He said his firm has been successful in getting relief from penalties by showing the evidence from tracking.
Write your Social Security number on your check: Paper checks might go missing or even get applied to someone else's account -- for example, that of someone who shares your name.
"What happens is ... they take your payment voucher and your check, and they separate them, so they don't necessarily have your name and your Social Security number attached anymore," Matthews explained. "Imagine your name is John Smith."
Who Must or Should File
If you don't have a regular job, you may not know whether you need to file. Here are some reasons why you definitely must or probably should:
Must:
- You owe self-employment tax: If you owe more than $400 in self-employment tax, you have to file. If you earned the income at the base where you're stationed, but you don't claim the state as your legal residence, you likely have to report it in the state you earned it in, if that state has income tax.
- You received the Premium Tax Credit for discounted health insurance: This tax credit allows low-income individuals to receive discounted insurance through the Health Insurance Marketplace.
- You received a 1099-SA for your health savings account (HSA): For the 2024 tax year, this may be likelier to apply to veterans than active-duty troops, although the Defense Department announced that it's introducing Health Care Flexible Spending Accounts for service members this month. Matthews described a pre-tax HSA as "a very good health vehicle to save yourself some money," because for veterans, in particular, "HSA-based, high-deductible plans usually are cheaper than if you go for a full-blown insurance plan."
Should:
- You're eligible to receive a refundable tax credit: A refundable credit reduces your tax bill and could even put money back in your pocket. College students in their first four years, for example, who are enrolled at least half the time can receive a refund of 40% of educational expenses up to a cap of $2,500 in expenses. This makes the maximum benefit $1,000, and a student needs to file a tax return to claim it. Similarly, the Child Tax Credit reduces a parent's taxes by $2,000 per child who is under 17 and meets other criteria, if the parent's income falls below $200,000 ($400,000 for married parents filing jointly).
Looking Ahead: Taxes Rules Expiring After 2025
In terms of whether the 2017 tax changes will expire after 2025, Matthews said Congress is due to "fight this fight this year." Some of the current provisions that might go away after 2025:
- Increased standard deduction amounts: The 2017 law increased the standard deductions by thousands. Accounting for inflation, the 2024 standard deductions are $14,600 for single filers and married people filing separately, $21,900 for heads of household and $29,200 for joint filers and surviving spouses.
- Suspensions of personal and dependency exemptions: These flat amounts for each individual, spouse and dependent child went away in favor of increasing the Child Tax Credit and standard deduction.
- Enhanced Child Tax Credit: The 2017 law increased the Child Tax Credit from $1,000 to $2,000.
- Limitation on moving expense deduction: Currently, only active-duty service members moving on orders may deduct their moving expenses from their taxable income. Until the limitation expires for good, if a civilian company pays you to move, you pay taxes on that money.
- Limit on itemized deductions for state and local taxes: Before the new rules took effect in 2018, households could deduct all their state and local property taxes, along with either their state and local income or sales taxes, whichever was greater, as long as they didn't exceed overall limits for itemized deductions. Since then, they could deduct only $10,000 in total in state and local taxes.
- Deductible interest on only up to $750,000 in mortgage debt: The prior limit was the interest on $1 million in mortgage debt.
While for the most part, the new provisions that passed in 2017 took effect in 2018, some took effect in 2017 even though that tax year was already underway.
With Congress expected to take up the debate again in 2025, Matthews ran down the list of what might happen "so that you guys are ready for the action and also ready to engage with ... any of your other interest groups that are fighting this fight for you."
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