2025 Tax Forecast

2025 promises to be a big year for taxes. Right now, the individual provisions of the Tax Cuts and Jobs Act of 2017 set our current standard deductions and tax brackets. Those rules expire, like Cinderella’s carriage at midnight on December 31. At that point, if Washington hasn’t extended them, taxes go up for as much as 80% of Americans. That’s an unacceptable result for Democrats and Republicans alike. And it promises a bruising effort ahead as Congress weighs continuing the cuts against a $36 trillion national debt.

January is traditionally a time for people to make predictions. We’ll see forecasts for the economy, for politics, for sports, and for everything else. So here’s our forecast for taxes. We’re going to see chaos. We’re going to see confusion. We’re going to see procrastination. We’re going to see wailing and gnashing of teeth and predictions of ruin if Washington doesn’t adopt this/that/the other pet provision or cause. We’re going to see House Speaker Mike Johnson desperately trying to corral his fractious caucus into passing a monstrous bill that won’t be anyone’s first choice. Spoiler alert: that’s not going out on a limb. That’s just how Washington works.

Regardless of what the final legislation looks like, it’s going to be a ride. So here are some thoughts to start exercising your 2025 tax-planning muscles:

• "If you get up early, work late, and pay your taxes, you will get ahead — if you strike oil." J. Paul Getty
• "If you are truly serious about preparing your child for the future, don't teach him to subtract — teach him to deduct." Fran Lebowitz
• "The question is: What can we, as citizens, do to reform our tax system? As you know, under our three-branch system of government, the tax laws are created by: Satan. But he works through the Congress, so that's where we must focus our efforts." Dave Barry
• "The avoidance of taxes is the only intellectual pursuit that carries any reward." John Maynard Keynes
• "The taxpayer — that's someone who works for the federal government but doesn't have to take the civil service examination." Ronald Reagan
• "Income tax returns are the most imaginative fiction being written today." Herman Wouk
• "Dear Tax Commissioner: Three years ago I cheated on my taxes. Since then I have been unable to sleep at night. Enclosed is $5,000. If I still can’t sleep, I'll send you the rest." Anonymous
• "Just because you have a briefcase full of cash doesn't mean you're out to cheat the government." Pete Rose
• "The difference between death and taxes is death doesn't get worse every time Congress meets." Will Rogers
• "Worried about an IRS audit? Avoid what's called a red flag. That's something the IRS always looks for. For example, let's say you have some money left in your bank account after paying taxes. That's a red flag." Jay Leno

We wish we could tell you exactly what's going to happen with taxes in 2025 and beyond. But whatever the future holds, we can promise we'll be here to help you make the best of it. And remember, we're here for your family, friends, and colleagues too!