Reminder that this tax season has now started.
All contact information for Pronto Income Tax office locations is here for you and we are ready to help you: https://pronto4tax.com/contact
As tax rules and regulations continue to rapidly change (and grow increasingly more complex), we want to continue to educate and empower you regarding your own tax situation.
With this goal in mind, we want to share with now you our “Top 10 Tax Changes” you should be aware of this year, in case these tax changes affect you or someone you know:
- Our hearts go out to everyone who’s been affected by the devastating wildfires here in our beloved City of Angels. Many of our own clients and staff members have affected, it has been a tough time for sure. As a result of this crisis, tax deadlines have been extended to October 15, 2025 for all L.A. County residents. This does not mean you need to wait to file your taxes, however. All Pronto office locations are open and serving our communities during this time of great need.
- For those who have suffered property damage from the fires-for example, losing a home-there are certain tax benefits that we may be able to claim, based on property damage or loss. For some situations, for example, we are able to claim a disaster loss on your 2024 tax return for a disaster that occurred in 2025. The first step of this process is for the affected person to document property items that were damaged or destroyed and assign an approximate value of each item or the total loss amount. You also would need to know and provide numbers as to any insurance reimbursement (or, if insurance hasn’t paid yet, give us info on your expected insurance reimbursement). If you are in this situation, please mention this to your Pronto Tax Professional so that we can investigate and utilize any tax benefits that may be available to you, based on your situation. This can be quite a complicated area but the tax benefits also can be quite significant…
- You may have heard on the news about the new 1099-K rules for “payment apps” such as Venmo, PayPal, and CashApp. These new 1099-K rules will result in more people receiving 1099’s that they didn’t receive before. If you receive a 1099-K, please take the time to identify where the income shown on the 1099-K comes from. If the income is related to the sale of personal items (selling your old baseball cards on eBay, selling clothing on Poshmark.com, etc.), please make a list of the items you sold, and how much you originally paid for each item. It is VERY possible that these sales will be NON-TAXABLE. Your records on that kind of thing don’t have to be “perfect” but please bring us the best information you have, so that we can make sure you don’t get wrongly overtaxed.
- If you are under age 60 and took money out of a retirement plan last year (IRA, 401K, etc.), there are some new exceptions that we might be able to use to help you avoid costly early withdrawal penalties. Please tell your Pronto Tax Professional how any withdrawn funds were used, so that we can try to avoid penalties for you.
- If you had any student loan debt canceled last year, the good news is that you won’t have to pay tax on the canceled debt. The “normal” rule that requires payment of income tax on canceled debt has been eliminated until 2026–for student loans only (does not apply to credit card debt, for example).
- If you purchased an electric vehicle last year, the dealership may have “transferred” a tax credit worth up to $7,500 to you at the time of purchase. In this case, the dealership should give you IRS Form 15400, showing any credit received at the time of purchase. Please make sure we get a copy of that form during this year’s tax preparation.
- If you suffered from tax-related identity theft or other tax-related fraud-for example, someone else wrongly claiming your dependent(s) on their tax return-please be advised that the IRS has some new and streamlined ways of protecting your taxes from fraud. If this is a concern for you, please mention this to your Pronto Tax Professional, so that we can assist you to protect yourself.
- If you buy or sell cryptocurrency (Bitcoin, etc.), or have done so in the past, it is important to realize that the IRS has been taking extensive measures to “tighten up” their tax collection on cryptocurrency. Starting for next tax season, for example, cryptocurrency exchanges (Coinbase.com, etc.) will be sending 1099’s showing gains and income received from cryptocurrency. If you “do crypto,” it would be a good idea to review your records now and make sure you have an accurate understanding of your gains and losses from cryptocurrency, so that you are not exposed to problems from increased IRS focus on cryptocurrency tax collections…
- With a new (returning) President now in office, we are expecting many more tax changes to happen this year. The existing set of tax rules, known as the “Tax Cuts and Jobs Act,” is set to expire at the end of 2025, which means that Congress and the President will be negotiating this year about how to extend and/or expand the existing rules. Expect more changes, while also being careful not to believe everything you hear, because tax misinformation is a real thing.
- Here are a few of the possible tax changes that are being discussed and debated right now: increased Child Tax Credit, new tax credit for caregivers, no tax on tips, no tax on overtime pay, and no tax on Social Security pensions. Please note that, as of today, these changes are not finalized, but are merely in the discussion / debate stage. We will strive to keep you updated as more tax changes happen!
With the tax code now being many thousands of pages long, we could go on (and on, and on) with more and more tax information for you. But we realize and respect that…you’ve got better things to do. After all, staying on top of “all this tax stuff” is what you hire us to do. 😊
Nevertheless, we hope the information provided to you in this letter gives you an idea of some of the most important tax changes that could affect you (and people you know).
Speaking of people you know, please consider sharing this information with friends and family who could benefit.
If you are ready to get started on your tax returns, or have any questions or concerns, please contact the Pronto Income Tax Office location that serves you. You will find a list of our office locations and contact info for each location here on our website: https://pronto4tax.com/contact
Thank you for the trust you place in us, and we look forward to helping you again very soon!
Sincerely,
Your Pronto Income Tax Team