WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’?

 

* From Ashleigh Fields at THE HILL – “Here are the jobs covered by Trump’s ‘No tax on tips’ law” –

“There are more than 60 jobs that will qualify for President [replace with ‘convicted felon and indicted traitor’ – rdf] Trump’s ‘no tax on tips’ law ushered in through his ‘One, Big, Beautiful Bill Act’.”

Here is the IRS publication of the individual Codes for qualifying “tipped” occupations.

* The IRS has issued drafts of the 2025 Form 1040, Schedule A, and a new Schedule1-A to reflect the tax law changes made by the Big but Not So Beautiful Bill.

The 2025 Form 1040 also enhances the section on Dependents, moves the check boxes for age 65 and blind to the Tax and Credits section on Page 2, adds additional check boxes for the Earned Income Credit, and makes the form 2 full pages.  Page 1 ends with the Adjusted Gross Income, which is very appropriate.

The 2025 Schedule A expands the Taxes You Paid section to reflect the increased SALT limit and has a worksheet to calculate the phase-down of the deduction.

The new Schedule 1-A provides sections to calculate new the tip, overtime, and senior deductions reflecting the AGI phase-outs.

* Kelley R. Taylor reports that a “New Bill Would End Taxes on Social Security Benefits in 2026: What Retirees Should Know” at KIPLINGER.COM –

“On September 4, Sen. Ruben Gallego (D-Ariz.), joined by Rep. Angie Craig of Minnesota, who introduced a parallel bill in the U.S. House of Representatives in April, unveiled the ‘You Earned It, You Keep It’ Act in the U.S. Senate.”

Kelley explains, “The bill would permanently abolish federal taxes on Social Security benefits”.

I have always said that Social Security benefits should be taxed the same way as any other contributory pension – but I do not oppose completely abolishing federal income taxes on Social Security benefits. 

When I first started preparing taxes Social Security benefits were exempt from income tax.  Benefits were first made partially taxable via the “Social Security Amendments of 1983”, signed into law by Ronald Reagan.  

A reminder - this bill has not yet passed.  So, no reason to celebrate yet.

* A warning from the NJ Division of Taxation –

“SCAM ALERT: If you receive an unsolicited text message claiming to be from the New Jersey Division of Taxation, it is a scam. We do NOT initiate text messages with taxpayers. We only send text messages if requested through our phone system. Never click links or share personal information in an unsolicited message. If you are unsure about a message, contact us directly through our official channels.”  

THE LAST WORD

America no longer a Democracy – it is a Kakistocracy.

Look it up.

TTFN

NEVER FORGET!

 

   Police Officer Maurice Barry - PATH Emergency Service Unit - P.O. Shield #1038

A Port Authority officer for 16 years, Maurice "Moe" Barry, 48, was assigned to the PATH commuter train system. The resident of Rutherford, NJ, upon hearing the reports of the terrorist attacks, was one of the first on scene when he rushed from Jersey City to Lower Manhattan and then into the North Tower to help in the rescue efforts. As thousands fled the searing flames and smoke of the Towers, Officer Barry was attempting to reach trapped and frightened workers on the upper floors. The last time he was seen, he was on his way to the higher floors to get people out.
.
Moe had a history of heroism - he was involved in rescue efforts during an airplane crash at La Guardia airport; he once climbed a bridge to retrieve the body of a person electrocuted there; he was involved in the rescue effort during the 1993 bombing of the World Trade Center; and he rescued a woman from her home, by boat, during Hurricane Floyd. Moe was also a volunteer for the Rutherford Ambulance Corps.

------------------------------------------------------

Most of us can remember exactly where we were and what we were doing on dates of historic importance.

The day President Kennedy was shot I was on a 6th Grade field trip to the Museum of Natural History in New York City. I was sitting in the theatre at the Hayden Planetarium watching a presentation when the show suddenly stopped. The lights went on and it was announced over the PA system that President Kennedy had been shot. We were all told to go home.

The day President Nixon resigned I was at a Crosby, Stills and Nash concert in Roosevelt Stadium on Route 440 in Jersey City (it no longer exists – it has been replaced by condos). CSN announced that Nixon had just resigned and proceeded to break into a rousing version of "Ohio" (“Tin soldiers and Nixon’s coming…).

When the planes crashed into the World Trade Center on September 11, 2001, I was on a Parker Tours escorted bus trip to Ocean City, Maryland. At the time of the attack our group was at the Assateague Island National Seashore. We were not told about it until we had returned to the bus and were driving back to our hotel, where we were supposed to attend a welcome reception. The reception was cancelled, and we all went to our individual rooms to watch the tragedy unfold on television.

On September 11, 2001, my client, and fellow Dickinson High School Class of 1971 graduate (although we did not discover this until many, many years later when he happened to notice an award I had received from my high school graduating class that was hanging on the wall of the Newark Avenue office and said that he graduated from DHS in 1971 too), Maurice “Moe” Barry was one of the members of the Port Authority Police Emergency Response Team, among the “first responders” to the initial attack, who were killed when the tower collapsed.

Moe always came in to have his tax return prepared on the very last day of the season, April 15, 16 or 17 of each year, a long-standing tradition he first began as a client of my mentor Jim Gill before I “inherited” the practice. Each year when we saw Moe we knew it was almost over. One year he came in on April 10th and we told him to go away and come back on the 15th. To honor Moe’s memory, before I retired, I no longer worked on 1040s on the last day of “the season”. For me the tax filing season ended each year on April 14th (or 15th or 16th). 

 

TTFN

WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’?

 

* The 2025–2026 New York State budget provides for the state’s first-ever Inflation Refund Checks for residents based on their 2023 IT-201 NY Adjusted Gross Income.

“Checks will be mailed over a period of several weeks beginning in mid-October of 2025.”

* The IRS has issued Fact Sheet 2025-05 to address the accelerated termination of several energy provisions under the big but not so beautiful bill -  

“OBBB accelerated the termination of several energy credit and deduction provisions. The following incentives expire the soonest:”

IRC	Credit	Termination date
25C	Energy efficient home improvement credit	Property placed in service after December 31, 2025.
25D	Residential clean energy credit	Expenditures made after December 31, 2025.
25E	Previously-owned clean vehicles credit	Any vehicle acquired after September 30, 2025.
30C	Alternative fuel vehicle refueling property credit	Any property placed in service after June 30, 2026.
30D	New clean vehicle credit	Any vehicle acquired after September 30, 2025.
45L	New energy efficient home credit	Any qualified new energy efficient home acquired after June 30, 2026.
45W	Qualified commercial clean vehicle credit	Any vehicle acquired after September 30, 2025.
179D	Energy efficient commercial buildings deduction	The deduction will not be allowed with respect to any property the construction of which begins after June 30, 2026.

* Speaking of the termination of energy credits, Kay Bell reports “IRS tweaks EV tax credit’s Sept. 30 ending date” at DON’T MESS WITH TAXES -

“ . . the IRS’ frequently asked questions (FAQ) fact sheet issued Aug. 21 says that a vehicle is acquired, per the OBBB requirement, ‘as of the date a written binding contract is entered into and a payment has been made.’”

* And Kay tells us “IRS releases draft 2026 Form W-2, incorporating no tax on tips or overtime income” in another DMWT post.

Kay explains how the newly required information on tip and overtime income available for the OBBA tax deductions are reported for 2026.  But there is no word on how this information will be reported on the 2025 W-2.  

* Russ Fox gives us the word that “IRS Closes Cincinnati Lockboxes; New Addresses In Effect Immediately” at TAXABLE TALK –

“The major change for residents of Alaska, California, Colorado, Hawaii, Idaho, Kansas, Michigan, Montana, Nebraska, Nevada, Ohio, Oregon, North Dakota, South Dakota, Utah, Washington, and Wyoming is that there are new addresses to mail Forms 1040-V and 1040-ES. (Paper-filed forms 1040 with a payment go to the 1040-V address.)”

His source is IRS Publication 3891 “Lockbox Addresses for 2026”.

THE LAST WORD

Supporting and enabling convicted felon and indicted traitor Trump and his attempt to effectively become the King of the United States is unconscionable.

The Republicans in Congress should be ashamed.

Every day brings more proof that nothing is more important – and I mean nothing – for the future of America than making sure the Democrats take control of Congress by a safe majority in 2026.

If Republicans maintain control of Congress, 2026 will not only be the 250^th anniversary of the Declaration of Independence but it will also be the end of American freedom and democracy.

TTFN

WHAT’S THE BUZZ, TELL ME WHAT’S A HAPPENNIN’?

 

* Kay Bell, the yellow rose of taxes, explains that “OBBB increases reporting thresholds for 1099 forms K, MISC, and NEC” at DON’T MESS WITH TAXES.

For 2026 the filing threshold for Forms 1099-NEC, Nonemployee Compensation, and 1099-MISC, Miscellaneous Information, will increase from $600 to $2,000, and will be increased for inflation for 2027 and beyond.

Kay ends with an excellent reminder -

“Earners also need to remember that a lack of a 1099 does not mean the money they received is tax-free. All earnings, even those amount not large enough to trigger issuance of a 1099, are taxable income and must be reported when tax returns are filed.”

* Jeff Stimpson reports “New Mexico weather victims get tax relief” at ACCOUNTING TODAY.

* The NJ Division of Taxation has released the “2024 Senior Freeze Payment Schedule”.

* Michael Cohn reports “Commissioner Billy Long leaving IRS for Iceland” at ACCOUNTING TODAY –

“President Trump has removed Billy Long as commissioner of the Internal Revenue Service in the latest sign of turmoil at the embattled agency.”

I wonder what sin of disloyalty to Trump Long committed.  Or what order from Trump he refused to carry out. 

THE LAST WORD

The motto of Trump and the Trump Administration –

“If you can’t dazzle them with brilliance (and we can’t) baffle them with bullshit.”

TTFN

NO TAX ON SOCIAL SECURITY? NO WAY, RAY!

 

The so-called “One Big Beautiful Act” does not make any change to the way Social Security benefits are taxed.  Depending on the extent of your other income, up to 85% of your gross Social Security benefits (before any Medicare deduction) continue to be taxed as ordinary income on the Form 1040 (or 1040-SR).

What the legislation does is create a deduction of $6,000 for every taxpayer age 65 or older at year-end for 2025 to 2028.  The deduction is per taxpayer, so if both spouses on a joint return are 65 or older they can deduct $12,000.  This deduction is available whether or not you are collecting Social Security.  

The amount of the deduction is reduced by 6% of the amount your Modified Adjusted Gross Income (MAGI) exceeds $75,000, or $150,000 if you are married and filing a joint return with your spouse.  For this deduction MAGI is your Adjusted Gross Income plus any exclusion for foreign income or income from Puerto Rico, Guam, American Samoa, and the Northern Mariana Islands.

You can claim the deduction whether or not you itemize your deductions on Schedule A.  The deduction is in addition to the extra Standard Deduction amount for senior taxpayers who do not itemize.  For married individuals the deduction is only available if you file a joint return.  This new deduction is not available on “Married Filing Separately” returns.   

So, there is a tax on your Social Security benefits, calculated in the same manner as it has been in the past.

FYI, I oppose the current method of calculating taxable Social Security benefits.  Social Security should be taxed in the same way as any other contributory pension.

TTFN

NO TAX ON OVERTIME?

 

Like “No Tax on Tips” the statement “No Tax on Overtime” in relation to the recently passed tax legislation is misleading.

The so-called “One Big Beautiful Act”, signed into law on July 4^th, did not exempt all overtime pay from all federal taxes.  The Act created a federal income tax deduction for up to $12,500 ($25,000 on a joint return) in overtime pay received for tax years 2025 (all of 2025) through 2028, phased out based on your “Modified” Adjusted Gross Income (MAGI).  For this deduction MAGI is your Adjusted Gross Income plus any exclusion for foreign income or income from Puerto Rico, Guam, American Samoa, and the Northern Mariana Islands.

There is no change to how overtime pay is reported.  The employer must still withhold, and match, the 7.65% FICA (Social Security and Medicare) tax and pay FUTA (federal unemployment) tax on overtime pay.  Employers received no tax benefit related to overtime pay in the new law.

As in the past, employers will include overtime pay in the amount reported as “wages, tips, other compensation” in Box 1, Social Security wages” in Box 3, and “Medicare wages and tips” in Box 5 of your 2025 Form W-2.  Overtime pay that qualifies for the deduction will be separately reported in Box 12 or Box 14.

And, also as in the past, you will report the amount from Box 1 of all W-2s on Line 1a of your 2025 Form 1040 (or 1040-SR).  What you will now be able to do is claim a deduction for up to $12,500, or $25,000, of qualified overtime (as identified on your Form W-2), which reduces your federal net taxable income. 

The amount of the maximum deduction you can claim for qualified tips is reduced by $100 for every $1,000 (or fraction thereof) that your MAGI exceeds $150,000, or $300,000 if you are married and filing a joint return with your spouse. 

What qualifies as overtime pay is pay for hours worked in excess of the standard 40-hour workweek, calculated at a rate above the employee’s regular hourly rate.  Only the “premium portion” of overtime pay qualifies for the deduction – the “half” portion of “time and a half”.  If an employee’s regular hourly rate is $20.00 and he/she is paid $30.00 per hour for overtime work only $10.00 of the overtime pay qualifies for the deduction.

This is not an itemized deduction.  You can claim the deduction for overtime pay whether or not you itemize your deductions on Schedule A.  For married individuals the deduction is only available if you file a joint return.  This new deduction is not available on “Married Filing Separately” returns.   

The Act does not change the state tax treatment of overtime pay.  Your overtime pay will still be subject to any state income tax and state payroll tax.

So, you could be paying no federal income tax on a portion of your overtime pay.

The amount that qualifies for the overtime pay deduction, and also the tip deduction, does not have to be calculated by the taxpayer, or tax preparer.  The amount of qualified overtime pay or tips will be separately reported on the employee’s Form W-2.

As with the new tip deduction – as a taxpayer and citizen I oppose the deduction for overtime pay as being unfair to W-2 employees who do not receive time and a half pay if they work more than 40 hours in a week.

TTFN

THIS I KNOW TO BE TRUE BEYOND ANY DOUBT

 

Donald J. “The Man Who Would Be King” Trump, the current President of the United States, is a totally worthless piece of garbage, completely devoid of intelligence, competence, character, integrity, honor, humanity, sympathy, and empathy who does not possess a single redeeming positive human quality or value.  He does not care one ounce about anyone or anything but himself and has never performed a single totally unselfish act in his entire adult life. 

Trump is a convicted felon, an indicted traitor who instigated an armed assault on the Capital and stole boxes of top-secret documents for personal use and gain upon leaving office.  A civil court determined Trump to be a rapist.  And he was impeached twice by Congress.

The legacy of the first Trump Presidency was the “legitimization” of racism, bigotry, and white supremacism.  The top priority of the current Trump Presidency is destroying the safeguards and programs that protect the safety, security, health, and finances of Americans.  His only agenda as President is to feed his ego, line his pockets, and gain for himself the total control of government of a medieval monarch.

Today the checks and balances of the separation of power so wisely created in the Constitution by our founding fathers no longer exists.  Trump currently controls all three branches of the federal government.

In our country’s history no one single individual has done more damage to America, the American people, American freedom and democracy, and true American values than Donald J “Little Mushroom” Trump.

The only Americans who could possibly support Trump and his Administration are either morons, racists, without a conscience, or, like Trump himself, someone who is all three.

It is vital for the future of America and Americans that every intelligent and patriotic American vocally and aggressively oppose and denounce Trump and his Administration and work to end his “reign”.

It is equally vital that every intelligent and patriotic American vote against EVERY candidate of today’s Trump-embracing Republican Party in EVERY election for EVERY office at EVERY level in 2025 and 2026.

TTFN