Accurate Income Tax & Accounting, Inc.

01/29/2026

What is the info on the account for kids? Open it on your tax return 2025 income tax return. Check it out

Trump Accounts provide eligible American children with tax-advantaged investment accounts courtesy of President Donald J. Trump.

01/20/2026

Other Dependent Credit

Dependents who do NOT qualify for the Child Tax Credit could be eligible for a non-refundable credit of up to $500 for each qualifying dependent.

"Other Dependent" facts:

The qualifying dependent must be a U.S. citizen, U.S. national, or U.S. resident alien.

Children age 17 or over, including college students, children with ITINs, or other older relatives in the taxpayer's household could qualify.

Additional limitations apply, per Notice 2018-70:

"Section 152(a) of the Code generally defines a “dependent” to mean a “qualifying child” or a “qualifying relative.” Section 152(d)(1) defines a qualifying relative to mean an individual

(A) who bears a specific relationship to the taxpayer,

(B) whose gross income for the calendar year in which the taxpayer’s taxable year begins is less than the exemption amount (as defined in § 151(d)),

(C) who receives over one-half of his or her support from the taxpayer for the calendar year in which the taxpayer’s taxable year begins, and

(D) who is not a qualifying child of the taxpayer or any other taxpayer for any taxable year beginning in the calendar year in which the taxpayer’s taxable year begins."

The credit begins to phase out at these AGI levels:

$400,000 MFJ

$200,000 MFS/S/HOH/QW

01/20/2026

Note This new tax bill, was signed into law on July 4, 2025. The One Big Beautiful Bill Act (OBBB or OB3) is now also being referred to by lawmakers as the Working Families Tax Cut Act. You may see one or both names used, but they refer to the same set of tax changes.

01/20/2026

Form 4547 is used to make the election to establish an initial Trump Account for an eligible child. If the child meets the additional requirements for the pilot program, Form 4547 is also used to elect the $1,000 pilot program contribution.

Establishing an Account
A Trump Account may be established for a child who is under age 18 at the end of the tax year in which the election is made, provided all other eligibility requirements are met.

If the child was born after December 31, 2024, and before January 1, 2029, the authorized individual may also elect to receive the $1,000 pilot program contribution, if the child otherwise qualifies.

Children born before January 1, 2025, are not eligible for the pilot program contribution but may still have a Trump Account established if they are under age 18.

Contributions
For each child with an established Trump Account, total annual contributions are generally limited to $5,000 per year, subject to IRS rules.

Certain contributions, such as the $1,000 pilot program contribution, qualified general contributions, and rollovers, are not counted toward the annual contribution limit.

Employer contributions under section 128 are subject to a separate annual limitation.

Contributions cannot be made before July 4, 2026.

Use of Funds

During the growth period (generally before January 1 of the year the child turns 18), distributions from a Trump Account are restricted and are permitted only for specific reasons (such as rollovers, excess contributions, or upon death of the beneficiary).

Beginning January 1 of the year the child turns 18, the Trump Account is treated similarly to a traditional IRA.

Distributions made after this point may be subject to the 10% additional tax on early distributions, unless an exception applies (such as qualified higher education expenses or first-time home purchase). Restrictions apply.

01/10/2026

Amen

01/10/2026

IMPORTANT DATES

IRS Individual e-File Start Date

The Internal Revenue Service (IRS) has announced in IR-2026-02 that they will begin accepting and processing 2025 individual tax returns on January 26, 2026. The IRS Prepare to File in 2026 page provides tips, key dates, and other details about the filing season.

Here is some additional information to help you plan for an easier opening to filing season:

Individual returns sent to Drake Software before January 26, 2026, will be held in a queue and transmitted to the IRS once the agency begins processing.
When the IRS starts processing returns, acknowledgment times may be slower than normal due to a high number of submissions. See KB Articles 12462 and 10783 for details on checking acknowledgments.
The IRS will begin accepting business returns on January 13, 2026, at 9 a.m. (ET).
The IRS will begin accepting 1041, 1120-H, and 709 returns on January 18, 2026.
The 2026 Individual filing season deadline is April 15, 2026.

08/04/2025

07/29/2025

Tax Tips for Clients that rent out a second home as a short term rental.

1. Determine Rental Property vs. Personal Use
The IRS applies different rules depending on how many days the property is rented vs. used personally.

14-Day Rule: If the property is rented out for fewer than 15 days during the year and used personally for more than 14 days (or more than 10% of the total days it’s rented), the rental income is not taxable, but expenses aren’t deductible either.
Mixed-Use Property: If it exceeds the 14-day threshold, it’s considered a vacation home, and income must be reported. Expenses must be allocated between personal and rental use.
Tip: Advise clients to keep meticulous records of personal vs. rental days to properly apply deductions.



2. Understand Deductible Expenses
Vacation rental owners can deduct business expenses, including:

Mortgage interest
Property taxes
Insurance
Depreciation
Utilities and maintenance
Management and cleaning fees
Advertising costs
However, if the property is also used personally, these expenses must be prorated accordingly.



3. Be Cautious with Depreciation
Vacation homes must be depreciated over 27.5 years, assuming they’re classified as residential rental property. This is often overlooked, especially when clients switch from personal to rental use mid-year.



4. Report Income Properly
Thanks to the American Rescue Plan Act, starting in 2023, platforms like Airbnb® and VRBO® must issue Form 1099-K if total transactions exceed $600. Clients may receive one even for a small number of bookings.

Don't forget to include direct payments received outside the platform.

5. Local Tax Considerations
Many jurisdictions levy lodging or occupancy taxes on short-term rentals. Ensure clients are collecting and remitting these if not handled automatically by the platform.

Encourage clients to check with local tax agencies for compliance requirements beyond federal taxes.



6. Plan Ahead for Estimated Taxes
Short-term rental income may not have tax withheld automatically. Clients may need to make quarterly estimated payments to avoid underpayment penalties—especially if rental income is substantial or seasonal.

07/29/2025

Here is what we know so far:

1. Permanent Extension of 2017 Tax Cuts
The OBBBA makes permanent the individual and corporate tax rate reductions introduced in the 2017 Tax Cuts and Jobs Act (TCJA), which were previously set to expire.

2. Increased SALT Deduction Cap
The state and local tax (SALT) deduction cap increases from $10,000 to $40,000 for households earning less than $500,000, effective through 2029.

3. Enhanced Child Tax Credit
The child tax credit increases to $2,200 per child starting in 2025, with a refundable portion capped at $1,400. The credit is indexed to inflation.

4. Senior Deduction Introduction
A new $6,000 deduction for taxpayers aged 65 and older is introduced, phasing out for individuals earning over $175,000 and couples over $250,000.

5. R&D Expensing Reinstated
The bill reinstates immediate expensing for domestic research and experimental (R&E) expenditures, reversing the TCJA's requirement to amortize these costs.