Holly C. Roundtree CPA, PLLC

President Donald Trump discussed many second-term tax priorities in his March 4 address to Congress, including a proposed restoration of 100% bonus depreciation. It allows businesses to deduct the costs of certain assets in the first year they’re acquired, rather than depreciate them over time. The Tax Cuts and Jobs Act included bonus depreciation at a 100% rate through 2022. However, in 2023, bonus depreciation began phasing out at 20% per year. Currently, the rate is 40% and it will drop to 0% in 2027 unless Congress acts to restore it. Supporters see a return to 100% bonus depreciation as a way to grow the economy. Stay tuned.

A day after signing an order to pause 25% tariffs on vehicles and vehicle parts from Canada and Mexico for one month, President Donald Trump added another exemption. There’s now also a one-month tariff reprieve on products from Canada and Mexico that comply with the United States-Mexico-Canada Agreement signed during Trump’s first term. (The U.S. will still impose tariffs on some products from Canada and Mexico that don’t comply.) This temporary reprieve will be in effect until April 2, when the temporary pause on vehicles and vehicle parts will also end. In addition, the White House announced that the tariff on the fertilizer potash will be 10%, rather than 25%.

You can’t keep funds in your traditional IRA indefinitely. You must start taking withdrawals from a traditional IRA (including a SIMPLE IRA or SEP IRA) when you reach age 73. You must take your first RMD by April 1 of the year following the year in which you turn 73, regardless of whether you’re still employed. The RMD for any year is the account balance as of the end of the immediately preceding calendar year divided by a distribution period from the IRS’s “Uniform Lifetime Table.” If you take money out of a traditional IRA before age 59?, you may be subject to a 10% penalty tax and income tax on the distribution. Contact us with any questions.

On March 5, 2025, President Trump announced a month-long pause in imposing tariffs on vehicles and vehicle parts shipped from Canada and Mexico to the United States. A 25% tariff that became effective on March 4 triggered retaliatory tariffs from Canada and threats of tariffs from Mexico. But the president has said the one-month reprieve is intended to appease the concerns of large U.S. automakers (not foreign trading partners), which rely on Canadian and Mexican vehicles and parts. A Trump spokesperson said he wants carmakers to move factories and jobs back to this country by April 2, when the suspended tariffs will again go into effect.

In his address to Congress on March 4, 2025, President Trump called on lawmakers to include several of his tax campaign promises in the budget plan currently being negotiated. Specifically, he asked them to eliminate income tax on Social Security benefits, tips and overtime pay. He also proposed allowing buyers of American-made vehicles to deduct auto loan interest. These breaks would be in addition to extending most of the 2017 Tax Cuts and Jobs Act provisions. The Republican-led U.S. House has passed a budget resolution that authorizes $4.5 trillion in cuts. But that proposal is expected to increase the deficit significantly.

Your small business may be eligible for big first-year Section 179 depreciation tax deductions for new and used heavy SUVs, pickups and vans placed in service in 2025. You must use the vehicle more than 50% for business. The write-off will reduce your federal income tax and self-employment tax bill, if applicable. This tax break is only available for a purchased (not leased) SUV, pickup, or van with a manufacturer’s gross vehicle weight rating above 6,000 pounds. The 2025 limit on Sec. 179 deductions for heavy SUVs $31,300. First-year depreciation deductions for lighter vehicles are subject to smaller depreciation limits of up to $20,400 in 2024. (The 2025 amount hasn’t come out yet.)

The IRS is reportedly making plans to cut up to half of its workforce. The tax agency will do this through a combination of layoffs, attrition and incentivized buyouts. The IRS currently employs approximately 90,000 workers, according to its latest data. Nearly 7,000 probationary workers with one year or less of service were let go in February. The mass layoffs of federal workers are part of President Trump’s efforts, through the Department of Government Efficiency, to root out perceived fraud, waste and abuse in the federal government.

On March 4, President Trump’s 25% tariffs went into effect for goods produced in Canada and Mexico. Trump also doubled the tariff on products from China to 20% (on top of other existing tariffs). Canada and China retaliated by announcing their own tariffs on American imports. Canadian Prime Minister Justin Trudeau said he’ll immediately enact a 25% tariff on $20.7 billion of U.S. goods, followed by an additional $86.2 billion in 21 days. China enacted 15% tariffs on chicken, wheat, corn and cotton imports from the U.S. It also enacted a 10% tariff on goods including soybeans, pork, beef, fruits, vegetables and dairy products. Mexico plans to announce retaliatory tariffs soon. Stay tuned.

For taxpayers who are due refunds but are still reluctant to receive them by direct deposit, it might be time to reconsider. The Financial Crimes Enforcement Network (FinCEN) statistics showed that paper check fraud schemes using U.S. mail are alive and surging. The latest FinCEN figures available show that from 2020 to 2022, the number of suspicious activity reports related to check fraud nearly doubled to over 680,000. Criminals steal checks from many sources and cash them or use information from stolen mail to exploit victims with other schemes such as credit card fraud. Victims of mail theft check fraud should report thefts by calling the U.S. Postal Inspection Service at 1-877-876-2455.