Robert A. DeLellis, CPA

01/03/2026

Have you heard that the One Big Beautiful Bill Act includes a new deduction for interest on vehicle loans? Here are some details.

Passenger vehicle loan interest deduction guidance released (12-31-25)

Proposed regulations clarify the eligibility requirements for the new IRC §163(h)(4) deduction for interest paid on qualified passenger loan vehicles purchased for personal use that is available for the 2025 through 2028 tax years. (REG-113515-25) The deduction is capped at $10,000 annually and is subject to phaseout for taxpayers with modified AGI above $150,000 ($250,000 MFJ). One of the requirements for the deduction is that the original use of the vehicle must commence with the taxpayer.

Highlights of the proposed regulations clarify that:

Only an individual, decedent’s estate, nongrantor trust, or disregarded entity (e.g., nongrantor trust or SMLLC) owned by one of these taxpayers can claim the deduction (assuming the other requirements are met);
The personal use requirement is met if at the time of purchase the taxpayer estimates that the vehicle will be used more than 50% of the time for personal use. Taxpayers do not have to reevaluate the personal use requirement in subsequent years. For disregarded entities the determination is made at the owner level, and for estates and trusts this is determined based on the expected use by the heirs or beneficiaries;
A taxpayer that uses a vehicle partially for business use can choose to deduct the interest as a business expense, but must reduce the auto loan interest deduction claimed on Schedule 1-A by the amount of business interest claimed;
The $10,000 limit applies per return, so MFJ filers are limited to a $10,000 deduction, while taxpayers who file MFS would be entitled to up to $10,000 per spouse;
Interest attributable to amounts directly related to the purchase of the vehicle (e.g., vehicle service plans, extended warranties, sales taxes, and vehicle-related fees) qualifies for the deduction; and
Although interest paid on refinanced loans qualifies for the deduction, the deduction is limited to interest paid on the outstanding balance of the refinanced loan as of the date of the refinancing.

12/11/2025

Our December tax newsletter is available on our website here:

07/22/2025

Here is an article from my monthly newsletter about the One Big Beautiful Bill Act.
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Key Tax Law Changes for Individuals and Businesses Under the OBBBA
On July 4, President Trump signed into law the far-reaching legislation known as the One, Big, Beautiful Bill Act (OBBBA). As expected, it extends and enhances many of the tax breaks from the Tax Cuts and Jobs Act (TCJA). It also includes several of Trump's campaign promises — though many are only temporary — and eliminates tax breaks related to clean energy. Here's a rundown of some of the main tax law changes to be aware of as you plan for the 2025 tax year.

Highlights for Individuals
-Makes permanent the TCJA's individual tax rates of 10%, 12%, 22%, 24%, 32%, 35% and 37%,
-Makes permanent the near doubling of the standard deduction, plus for 2025 increases it to $15,750 for single filers, $23,625 for heads of households, and $31,500 for joint filers, with annual inflation adjustments going forward,
-Makes permanent the higher child tax credit, plus for 2025 increases it to $2,200, with annual inflation adjustments going forward,
-Temporarily increases the limit on the deduction for state and local taxes (the SALT cap) to $40,000 for 2025, with a 1% increase each year through 2029, after which the $10,000 limit will return,
-Expands the allowable education expenses that can be paid with tax-free Section 529 plan distributions, beginning July 5, 2025, or Jan. 1, 2026, depending on the type of expense,
Permanently increases the federal gift and estate tax exemption amount to $15 million for individuals and $30 million for married couples beginning in 2026, with annual inflation adjustments going forward,
-For 2025–2028, creates a new deduction of up to $25,000 for tip income in certain industries, subject to income-based phaseouts,
-For 2025–2028, creates a new deduction of up to $12,500 for single filers or $25,000 for joint filers for qualified overtime pay, subject to income-based phaseouts,
-For 2025–2028, creates an above-the-line deduction of up to $10,000 for qualified passenger vehicle loan interest on the purchase of certain American-made vehicles, subject to income-based phaseouts,
-For 2025–2028, creates an additional deduction of up to $6,000 for taxpayers age 65 or older, subject to income-based phaseouts, and
Eliminates clean energy tax credits, generally after 2025, such as the energy-efficient home improvement and residential clean energy credits — but eliminates the clean vehicle credits for both new and used vehicles after Sept. 30, 2025.

Highlights for Businesses:
-Makes permanent and expands the 20% Sec. 199A qualified business income (QBI) deduction for owners of pass-through entities (such as partnerships, limited liability companies, and S corporations) and sole proprietorships.
-Makes bonus depreciation permanent and increases it to 100% for qualified new and used assets acquired after January 19, 2025,
-Increases the Sec. 179 expensing limit to $2.5 million and the expensing phaseout threshold to $4 million for 2025, with annual inflation adjustments going forward.
Permanently allows the immediate deduction of domestic research and experimentation expenses (retroactive to 2022 for eligible small businesses), and
-Eliminates clean energy tax incentives, such as the alternative fuel vehicle refueling property credit and the Sec. 179D deduction for energy-efficient commercial buildings after June 30, 2026 — but eliminates the qualified commercial clean vehicle credit after Sept. 30, 2025.

How Will You Be Affected?
While this list may seem extensive, it represents just a sampling of the tax changes included in the 870-page OBBBA. Contact the office with questions about how the new law will affect you.

02/26/2023

The IRS announced on 02.24.23 that the due dates have been extended for taxpayers in disaster areas in CA, AL & GA until October 16, 2023.

IR-2023-33, Feb. 24, 2023 — Disaster-area taxpayers in most of California and parts of Alabama and Georgia now have until Oct. 16, 2023, to file various federal individual and business tax returns and make tax payments, the Internal Revenue Service announced today. Previously, the deadline had bee...

01/13/2023

The IRS has extended some due dates for the CA counties listed below:

IRS grants filing extensions to California storm victims (01-11-23)

The IRS is granting extensions to California storm victims until May 15, 2023, for the following filing and payment deadlines that were normally scheduled for on or after January 8, 2023:

Individual income tax returns;
Business return filings normally due between March 15 and April 18, 2023;
Third and fourth quarter estimated tax payments due on January 17, 2023, and April 18, 2023. Individual taxpayers can skip making the fourth quarter estimated tax payment and instead include it with the 2022 return as long as the return is filed on or before May 15, 2023;
IRA and health savings account (HSA) contributions; and
Quarterly payroll and excise tax returns, normally due on January 31, 2023, and April 30, 2023.
In addition, penalties on payroll and excise tax deposits due on or after January 8, 2023, and before January 23, 2023, will be abated as long as the tax deposits are made by January 23, 2023.

The relief is automatically available to taxpayers who reside or have a business in the following counties:

Colusa Merced San Diego Sonoma
El Dorado Monterey San Joaquin Stanislaus
Glenn Napa San Luis Obispo Sutter
Humboldt Orange San Mateo Tehama
Los Angeles Placer Santa Barbara Ventura
Marin Riverside Santa Clara Yolo
Mariposa Sacramento Santa Cruz Yuba
Mendocino San Bernardino Solano
The IRS will also work with any taxpayer who lives outside the disaster area but whose records necessary to meet a deadline occurring during the postponement period are located in the affected area. Such taxpayers should contact the IRS at (866) 562-5227.

We are awaiting confirmation from the FTB as to whether California will conform to this extension. We will send out another Flash E-mail once we receive confirmation.

The IRS news release is available at:

www.irs.gov/newsroom/irs-california-storm-victims-qualify-for-tax-relief-april-18-deadline-other-dates-extended-to-may-15

05/10/2021

Tax Return Tips for Last-Minute Filers

When it comes to working on your taxes, earlier is better, but many people find preparing their tax return to be stressful and frustrating and wait until the last minute. Complicating matters this year is tax reform and the newly redesigned Form 1040. If you've been procrastinating on filing your tax return this year, here are eight tips that might help.

Don't Delay
Resist the temptation to put off your taxes until the very last minute. Your haste to meet the filing deadline may cause you to overlook potential sources of tax savings and will likely increase your risk of making an error. Getting a head start - even if it is a week or two) will not only keep the process calm but also mean you get your return faster by avoiding the last-minute rush.

Gather Tax Documents in Advance
Make sure you have all the records you need, including W-2s and 1099s. Don't forget to save a copy for your files.

Double-check Math and Verify Social Security Numbers
These are among the most common errors found on tax returns. Taking care will reduce your chance of hearing from the IRS. Submitting an error-free return will also speed up your tax refund.

E-file for a Faster Tax Refund
Taxpayers who e-file and choose direct deposit for their refunds, for example, will get their refunds in as few as ten days. That compares to approximately six weeks for people who file a paper return and get a traditional paper check.

Don't Panic if You Can't Pay
If you can't immediately pay the taxes you owe, consider some stress-reducing alternatives. You can apply for an IRS installment agreement, suggesting your monthly payment amount and due date and getting a reduced late payment penalty rate. You also have various options for charging your balance on a credit card. There is no IRS fee for credit card payments, but the processing companies charge a convenience fee. Electronic filers with a balance due can file early and authorize the government's financial agent to take the money directly from their checking or savings account on the April due date, with no fee.

Request an Extension of Time to File
If the clock runs out, you can get an automatic six-month extension bringing the filing date to October 15, 2021 - but make sure you pay by the May 17 due date. However, the extension itself does not give you more time to pay any taxes due. You will owe interest on any amount not paid by the April deadline, plus a late payment penalty if you have not paid at least 90 percent of your total tax by that date.

Taxpayers Outside the United States File June 15
U.S. citizens and resident aliens who live and work outside the U.S. and Puerto Rico have until June 15, 2021, to file their 2020 tax returns and pay any tax due. The special June 15 deadline also applies to military members on duty outside the U.S. and Puerto Rico who do not qualify for the longer combat zone extension. Affected taxpayers should attach a statement to their return explaining which of these situations apply. Although taxpayers abroad get more time to pay, interest - currently at the rate of 3% per year, compounded daily - applies to any payment received after this year's May 17 deadline.

Military Service Members Serving in a Combat Zone
Combat zone taxpayers (including eligible support personnel) have at least 180 days after they leave the combat zone to file their tax returns and pay any tax due - including those serving in Iraq, Afghanistan, and other combat zones. A complete list of designated combat zone localities is available on the IRS website. Combat zone extensions also give affected taxpayers more time for a variety of other tax-related actions, including contributing to an IRA. Various circumstances affect the exact length of the extension available to taxpayers.

Help is Just a Phone Call Away
If you run into any problems, have any questions, or need to file an extension, contact the office today.

04/01/2021

DO NOT AMEND YOUR 2020 RETURNS IF YOU FILED BEFORE THE AMERICAN RESCUE PLAN ACT PROVISION TO EXCLUDE UP TO $10,200 OF UNEMPLOYMENT COMP RECEIVED IN 2020. THE IRS WILL ADJUST THIS AUTOMATICALLY.

IRS announces plan to adjust returns for unemployment exclusion (03-31-21)

The IRS will automatically adjust 2020 returns for taxpayers who filed prior to the enactment of the unemployment compensation exclusion included in the American Rescue Plan Act. (IR-2021-71) The returns will be adjusted to exclude up to $10,200 ($20,400 for MFJ) of unemployment compensation for taxpayers with modified AGI of less than $150,000.

The IRS expects that the first refunds will not be issued until May and will continue into the summer. With processing delays at the IRS, it is unlikely that filing an amended return will generate a refund any faster. However, the IRS has confirmed that the automatic adjustments will not increase any other benefits on the taxpayers’ returns that are limited by AGI. As a result, for clients who will benefit from increased Recovery Rebate Credits, Earned Income Credits, etc., you may want to consider amending those returns.

Though the IRS has stated they will also be automatically refunding excess Premium Tax Credits that were paid with 2020 returns, there was no information on those refunds included in this guidance.

03/31/2021

Updated info regarding the postponed April 15th due date and other tax saving opportunities by using the married filing separate filing status for some couples that colleted unemployment:

PPP deadline extended and other updates (03-30-21)

The President has signed H.R. 1799, the PPP Extension Act of 2021. The Act extends the application deadline for both first and second draw PPP loans from March 31 to May 31, 2021.

IRA/HSA extensions

Notice 2021-21 confirms the information previously announced at an IRS Liaison Stakeholder meeting. The May 17, 2021, extended filing deadline for individual returns also extends the deadline for taxpayers to make contributions to their IRAs (including Roth IRAs), HSAs, MSAs, and Coverdell education savings accounts.

The Notice also confirms that first quarter estimated tax payments are still due on April 15, 2021. However, the Notice does not address the unanswered question of what date overpayments from extended 2020 returns will be applied for estimated tax purposes. At this point we recommend practitioners consider that these overpayments may be credited using the May 17, 2021, extended due date, and would apply to second quarter estimates, not first quarter estimates. We will update you on this issue as news develops.

Economic impact payments

The IRS has updated the Get My Payment tool to enable taxpayers to check on the status of their third EIP. That tool can be found at:

www.irs.gov/coronavirus/get-my-payment

The IRS has also issued FAQs that clarify the following:

Taxpayers will receive Notice 1444-C, Your Third Economic Impact Payment, to provide information on the amount of their third payment;
Payments that aren’t received through direct deposit may be sent by check or a new debit card; and
The IRS will continue to process 2020 tax returns and issue additional payments in 2021 to individuals who have not already received a third payment or who are eligible to receive an additional amount if their initial payment was based on their 2019 tax return, but their 2020 tax return (once filed) yields a higher EIP.

Considerations for MFS

Many couples are benefiting from filing MFS to allow them to exclude their unemployment income. However, for couples on Medicare, you must also consider potential Medicare premium surcharges. We have received several comments from practitioners whose clients saved several thousand dollars on their 2020 returns with the UI exclusion and increased Recovery Rebate Credits. Unfortunately, one or both of the spouses were then subject to additional Medicare premiums, which were greater than the tax savings.

Use Get My Payment to get information about your payment status and payment type.

03/18/2021

From the Journal of Accountancy - NOTE: the postponement does NOT apply to your 1st 2021 estimated tax payment. THAT is still due on April 15, 2021.

IRS postpones April 15 deadline
The IRS announced on Wednesday that it is postponing the deadline for all individual tax returns. Returns otherwise due April 15 will not have to be filed until May 17 this year. The IRS says it will issue formal guidance in the near future.

The postponement applies only to individual taxpayers, who can postpone their federal income tax returns and income tax payment due on April 15 until May 17, 2021. They do not have to file Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return, to qualify for this postponement.

The IRS says taxpayers who request an extension using Form 4868 will, as usual, have until Oct. 15 to file their returns, but their tax payments will be due May 17.

No interest, penalty, or addition to tax for failure to file a federal income tax return or to pay federal income taxes will accrue between April 15, 2021, and May 17, 2021, for any return or payment postponed by the announcement.

The postponement does not apply to estimated income tax payments due April 15, 2021, for 2021 tax years. The postponement, as announced on Wednesday, does not apply to any other type of federal tax or to any federal information returns.

03/13/2021

We are holding off on filing returns for clients that received Unemployment Benefits in 2020. The first $10,200 will NOT be taxable. Our software company is working to update their program and we should be able to submit those returns very soon (with a MUCH better result).

IRS Statement - American Rescue Plan Act of 2021
March 12, 2021

The IRS is reviewing implementation plans for the newly enacted American Rescue Plan Act of 2021. Additional information about a new round of Economic Impact Payments, the expanded Child Tax Credit, including advance payments of the Child Tax Credit, and other tax provisions will be made available as soon as possible on IRS.gov. The IRS strongly urges taxpayers to not file amended returns related to the new legislative provisions or take other unnecessary steps at this time.

The IRS will provide taxpayers with additional guidance on those provisions that could affect their 2020 tax return, including the retroactive provision that makes the first $10,200 of 2020 unemployment benefits nontaxable. For those who haven't filed yet, the IRS will provide a worksheet for paper filers and work with software industry to update current tax software so that taxpayers can determine how to report their unemployment income on their 2020 tax return. For those who received unemployment benefits last year and have already filed their 2020 tax return, the IRS emphasizes they should not file an amended return at this time, until the IRS issues additional guidance.

03/20/2020

BREAKING NEWS: President Trump just announced the tax due date for BOTH filing and making payments for 2019 taxes will be moved to July 15, 2020. If you are one of my clients please don't wait until the last minute. I want your info by June 15th to allow ample time to prepare and file your returns by July 15th. I want to thank all of my clients/friends, some of whom I've been their accountant since 1989. I appreciate your business and care about you all. Be safe and healthy. 💕

06/11/2019

Are you participating in the "Sharing Economy"? If so or you're thinking about it check out this article in my newsletter for June.

Robert A. DeLellis, CPA is a full service tax, accounting, business consulting, and entertainment business management firm located in Camarillo, CA