Kneeream Emmi & Dougherty LLC

Kneeream Emmi & Dougherty LLC We are a firm of Certified Public Accountants specializing in individual, trust, and business tax preparation and planning.

Additionally, we offer business consultation, payroll, sales tax, and bookkeeping services

11/21/2025

OBBBA Update #4: Increased Deduction for Certain State and Local Taxes

As the year draws to a close, we would like to dedicate some posts to new and updated tax deductions that can be found in the “One Big Beautiful Bill Act” (OBBBA). The next deduction we would like to discuss is the State and Local Tax Deduction. The following are a few notes regarding changes to this deduction:

• For taxpayers that itemize, the limitation on the state and local tax deduction has been increased to $40,000 for 2025. It was previously $10,000.

• In 2026, the deduction limitation will be $40,400

• In 2027 through 2029, the deduction limitation will increase by 1% of the limitation in the prior tax year.

• Tax years after 2029 will revert to the $10,000 limitation

• The OBBBA also implemented a phasedown of this deduction. The phasedown is 30% of the taxpayer’s modified gross income that is in excess of a “threshold amount”. The threshold amount is $500,000 in 2025, and will increase by 1% of the previous taxable year in subsequent years. The phasedown will not reduce the deduction to below $10,000.

11/19/2025

OBBBA Update #3: Reinstated Charitable Deduction for Nonitemizers

As the year draws to a close, we would like to dedicate some posts to new and updated tax deductions that can be found in the “One Big Beautiful Bill Act” (OBBBA). The next deduction we would like to discuss is the Charitable Deduction for Nonitemizers. The following are a few notes about this deduction:

• Nonitemizers who take the standard deduction may now deduct contributions to charitable organizations.

• The deduction is limited to $1,000 ($2,000 for joint filers).

• You must maintain a record of the contribution, such as a bank record or a written communication from the qualified organization that lists the organization’s name, the amount, and the date of the contribution.

• For contributions of $250 or more, you must obtain and keep a contemporaneous written acknowledgement from the qualified organization that contains the name of the organization, the date and amount of the gift, and indicates whether the organization provided any goods or services in exchange for the gift.

• Contributions of property do not qualify for this deduction.

• Contributions to donor advised funds and non-operating private foundations do not qualify for this deduction.

• Contribution carried forward from prior tax years do not count toward this deduction. Additionally, non-itemizer contributions in excess of $1,000 ($2,000 for joint filers) do not carry forward to subsequent tax years.

• These contributions are not subject to the new 0.5% AGI floor (to be discussed in a future post).

• This deduction has been made available for tax years starting in 2026.

• This deduction does not expire, as it has been made permanent.

11/17/2025

OBBBA Update #2: New Deduction for Car Loan Interest

As the year draws to a close, we would like to dedicate some posts to new and updated tax deductions that can be found in the “One Big Beautiful Bill Act” (OBBBA). The next deduction we would like to discuss is the Deduction for Car Loan Interest. The following are a few notes about this deduction:

• The deduction is up to $10,000 per year in car loan interest.

• You do not have to itemize to take this deduction.

• The loan must have originated after December 31, 2024, and must be secured by a lien on the vehicle.

• The vehicle must be new. Used vehicles do not qualify.

• The vehicle must be for personal use only. It cannot be used in a business.

• The vehicle must have a GVWR of less than 14,000 lbs

• The vehicle must have undergone final assembly in the United States. Because the requirement is regarding location of final assembly, the manufacturer does not have to be a U.S. company. Be sure to verify the final assembly with the dealer. It is also a good idea to verify this independently. You can find this information by using the VIN decoder at the National Highway Traffic Safety Administration’s website.

• Lenders are required to furnish taxpayers with a formal tax statement that will report how much interest was paid during the year (Form 1098-VLI. However, the IRS is providing transition relief for 2025. This means that you may not receive this form. If you are planning to take this deduction, we will need the original purchase documents showing the VIN, date of purchase, and the loan agreement. Additionally, we will need a statement from the lender that shows total interest paid for the year.

• Phaseout: This deduction begins to phase out for taxpayers with modified adjusted gross income of $100,000 ($200,000 for joint filers), and is phased out at a rate of $200 for each $1,000 of income over the MAGI threshold.

• This deduction is available for tax years 2025 through 2028.

11/12/2025

OBBBA Update #1: New Deduction for Seniors

As the year draws to a close, we would like to dedicate some posts to new and updated tax deductions that can be found in the “One Big Beautiful Bill Act” (OBBBA). The first of these is the new “Deduction for Seniors” The following are a few notes about this deduction:

• The deduction is $6,000 for seniors who are age 65 and older, and $12,000 for a married couple where both spouses qualify. The taxpayers must attain age 65 on or before the last day of the taxable year.

• This deduction is not available to married taxpayers filing separately.

• You do not have to itemize to receive this deduction

• Phaseout: This deduction begins to phase out for taxpayers with modified adjusted gross income of $75,000 ($150,000 for joint filers), and is fully phased out at $175,000 ($250,000 for joint filers).

• This deduction is available for tax years 2025 through 2028

Address

1015 West Linden Street
Scranton, PA
18504

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Wednesday 9am - 5pm
Thursday 9am - 5pm
Friday 9am - 5pm

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+15703432479

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