Treasury’s assistant secretary for tax policy, Ken Kies, said agency lawyers are working on the regulations needed to implement the new tax law. Soon to come out will be regs on overtime, tips, car loan interest, seniors, accelerated depreciation, and Trump savings accounts, he said.

Workers who receive qualified overtime pay in 2025 are entitled to an up to $12,500/individual tax deduction if they earn less than $150,000. That means employers have to track and report qualified overtime pay. New guidance on how to do that is expected, but current guidance is limited.

Inflation-adjusted tax deductions for premiums for qualified long-term care insurance have been announced. The deductions vary by age but generally the inflation adjustments increase the deduction by about 3 percent.

For premiums paid for long-term care insurance to be deductible, the insurance has to meet statutory qualification requirements, including consumer protections. Those requirements did not change. The premiums must also exceed 7.5 percent of the taxpayer’s adjusted gross income.

The Internal Revenue Service (IRS) has released draft instructions for Affordable Care Act (ACA)-required reporting of offers of employee health insurance coverage and employee enrollment in health insurance coverage. The instructions will be for Forms 1094-C and 1095-C.

The Internal Revenue Service (IRS) has released guidance on how to report third-party transactions. The reporting thresholds increased via a provision in the spending/tax cuts law enacted this past July. The new transaction thresholds are 200 transactions in a year and/or transactions that exceed $20,000. The previous threshold was any transaction that exceeded $600.

On October 22 the Internal Revenue Service (IRS) released guidance in the form of frequently-asked questions (FAQs) on the new Employee Retention Tax Credit (ERTC) compliance provisions. The new compliance provisions were enacted last summer in the tax/spending cuts reconciliation bill that was signed into law on July 4.

Ballot initiatives approved by Texas voters on November 4 banned the imposition of state estate and inheritance taxes, and tax on unrealized capital gains. Proposition 8, the measure that bans estate/inheritance taxes, was a constitutional amendment. Proposition 2, also a constitutional amendment, forbids imposition of tax on gains in the value of capital assets when those gains have not been realized (the asset sold).

On October 1, the Senate Finance Committee held a hearing on how crypto assets should be taxed. Senators from both parties acknowledged that crafting tax rules for digital assets will be a complicated undertaking.

Based on testimony and questions from committee members at the hearing, a key issue that has yet to be resolved is what to do about small crypto transactions. Witnesses at the hearing argued that some kind of de minimis rule for small crypto transactions is necessary. Committee members questioned that, though. It was clear from the hearing interactions that determining what a “small transaction” is could be a fraught issue.

A slew of indexed tax limits and benefits adjust each year for inflation. The Internal Revenue Service (IRS) has released Rev.Proc.2025-32, which lists many of these adjustments. Generally, the adjustments amount to about two percent for 2026.

In a nod to the political potency of the risk that enhanced Affordable Care Act (ACA) premium tax credits will expire at the end of 2025, a group of 10 House Republicans—joined by several Democrats—have offered legislation to extend the premium tax credits as they were enhanced in 2021 (during the COVID pandemic) for one year.

Lawmakers in both the House and Senate are looking at legislation that would allow employers to provide tax-free benefits to their independent contractors. A House Committee approved legislation that would create a safe harbor that would insulate employers and workers from workers being characterized as employees due to the provision of these “portable” benefits. Separately, a Senate committee held a hearing on similar proposals.

H.R.1 as enacted into law extends the tax credit for employer-provided paid leave. Plus, the new law expands the tax credit by allowing employers to choose whether to take the deduction based on leave taken, or on the premiums paid for insurance that provides paid leave benefits.

On a party-line vote on June 26, the Senate confirmed the nomination of Ken Kies to be assistant secretary for tax policy. The 53 to 45 vote puts Kies in a key position as Treasury must promulgate implementing regulations for a raft of new tax rules signed into law on July 4.

The House-passed reconciliation budget bill, H.R.1, contains a provision that would make certain overtime (OT) pay free from income tax, but not from payroll (Social Security/Medicare) taxes. This tax relief provision is limited both by income and by the Fair Labor Standards Act’s (FLSA’s) definition of qualified overtime hours.

During the week of April 29, House committees of jurisdiction began crafting their pieces of the $6 trillion+ reconciliation budget bill that Congress wants to enact by the end of this summer. The process is and will continue to be fraught as lawmakers make tough decisions, on which there is and will be much opposition, on how to cut spending and taxes for the upcoming 10 years.

The House Ways and Means Committee approved its reconciliation title on May 14 on a party line vote after a 17-hour mark-up. The tax title of the reconciliation bill contains provisions that would permanently extend (i.e., eliminate an expiration date) a raft of tax rules that are set to expire at the end of this year. A few of these extension provisions also modify the expiring rules, including the Section 199A deduction. In addition, the title includes new tax cuts first proposed by President Trump as well as other tax cuts. Offsets are included to ensure that the cost of the title complies with the Committee’s reconciliation instructions. Significantly and in a major victory for NAIFA, the Committee did not attempt to raise revenue from the products and services NAIFA provides to assist American families in achieving financial security.

The Internal Revenue Service (IRS) has announced the inflation-adjusted limits for high deductible health plans (HDHPs), Health Savings Accounts (HSAs), and Health Reimbursement Arrangements (HRAs) for 2026. Also announced were 2026 limits for excepted benefits HSAs.

On April 29, on a party-line vote, the Senate Finance Committee approved the nomination of Ken Kies to be Treasury Assistant Secretary for Tax Policy. Kies will play a key role in the development of all tax legislation, but especially now in the crafting of the tax portion of the massive reconciliation bill.

On March 12, the Treasury Department announced that the federal deficit has grown to $1.15 trillion over the first five months (October through February) of Fiscal Year (FY) 2025. This is 17 percent higher than the deficit level at this time last year. According to the Treasury release, the deficit in February alone grew to $307 billion.

On March 12, Rep. Tom Suozzi (D-NY), a member of the tax-writing House Ways & Means Committee, introduced a bipartisan bill, the WISH Act, that would create a public-private partnership to address the affordability of long-term care. The bill was cosponsored by Rep. John Moolenaar (R-MI).