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Individual Tax Preparation: Maximizing Your 2025 Tax Returns

For families and individuals across Stoughton, Massachusetts, and the surrounding South Shore area, the arrival of the 2026 filing season marks a major shift in how households approach their annual returns. Rather than a simple end-of-year obligation, this period is a critical window to capitalize on the federal One Big Beautiful Bill Act (OBBBA) and recent Massachusetts-specific legislative updates. By the time the April 15, 2026, deadline arrives, taxpayers will find that the rules governing their 2025 income have evolved significantly, offering fresh avenues to protect their earnings and boost their bottom line.

As a Certified WOSB (Woman-Owned Small Business), Brenda J. McGivern, P.C., is here to help you navigate these shifting rules. Whether you are a high earner in Stoughton or a working family, understanding the interplay between federal benefits and Massachusetts state requirements is key to maximizing your refund.


1. Itemizing vs. The Standard Deduction: The SALT Game-Changer


The OBBBA has fundamentally changed the math for Massachusetts homeowners. For the 2025 tax year, the federal Standard Deduction has risen to $16,100 for Single filers and $32,200 for Married Filing Jointly.

However, the headline for the 2025 tax year is the increase in the SALT Deduction Cap. Previously capped at $10,000, the federal cap for state and local tax (SALT) deductions has quadrupled to $40,400 for the 2025 tax year.

  • Why it matters for Stoughton: In a high-property-tax state like Massachusetts, many residents who previously took the standard deduction may now find that itemizing saves them thousands. When you combine your MA state income tax (5%) with your local property taxes, you are much more likely to exceed the standard deduction threshold.
  • Phase-out Warning: It is important to note that this $40,400 cap begins to phase out if your modified adjusted gross income (MAGI) exceeds $500,000. For every dollar earned above this threshold, the deduction limit is reduced by 30 cents, making professional planning essential for high-income households.

2. Updated Family Credits: Child Tax Credit & EITC


Families filing in 2026 will see enhanced support for their 2025 earnings through several permanent expansions:

  • Child Tax Credit (CTC): The maximum federal credit is now $2,200 per child (up from $2,000), with a refundable portion of up to $1,700. To qualify, both the child and at least one parent (on a joint return) must have a valid Social Security Number.
  • Earned Income Tax Credit (EITC): For families with three or more children, the maximum federal credit has risen to $8,231.
  • Massachusetts Specifics: Massachusetts continues to offer its own state-level credits, such as the Circuit Breaker Credit for seniors, which has increased to a maximum of $2,820 for the 2025 tax year. These state credits can significantly boost your total return beyond the federal benefits.

3. Mortgage, Student Loans, and the New Car Loan Deduction


Massachusetts taxpayers have unique federal and state deductions to consider for their 2025 returns:

  • Student Loan Interest: You can deduct up to $2,500 in interest on your federal return. This is an "above-the-line" deduction, meaning you do not need to itemize to claim it. The full deduction is available for joint filers with a MAGI up to $170,000.
  • Employer Assistance: Massachusetts has a unique provision allowing employees to deduct employer-paid student loan principal or interest if it hasn't already been excluded from their federal income.
  • New Car Loan Interest: A major update for the 2025 tax year allows a federal deduction for interest paid on new car loans for vehicles assembled in the U.S., capped at $10,000 in interest annually.

4. Reporting "Venmo" Income and Crypto


The reporting rules for digital transactions are strictly enforced in Massachusetts:

  • The Massachusetts $600 Threshold: While federal reporting rules for apps like Venmo or PayPal have fluctuated, Massachusetts maintains a $600 threshold. If you received more than $600 for goods or services in 2025, you will likely receive a Massachusetts Form 1099-K. Our firm helps you reconcile these forms to ensure you aren't paying tax on personal reimbursements.
  • Crypto (Form 1099-DA): For the first time, brokers are issuing Form 1099-DA for 2025 digital asset sales. This form provides the "cost basis" for your trades, which is vital for accurately calculating capital gains or losses.

5. Energy-Efficiency: Federal Sunsets and Mass Save


The 2025 tax year was the final window for several high-value federal energy credits.

  • Federal Solar & Geothermal: The Residential Clean Energy Credit provided a 30% credit for systems installed through 2025. If you completed a project last year, we must claim it on this return to secure the credit.
  • Mass Save® Coordination: While federal credits are tightening, Mass Save® remains a primary tool for local residents. We help you coordinate your 2025 heat pump or insulation upgrades with available state rebates to maximize your total savings.

Special 2025 Benefits: Overtime, Tips, and the "Millionaire's Tax"


  • No Tax on Overtime & Tips: Under the OBBBA, the "premium" portion of overtime pay (the "half" in time-and-a-half) and qualified tips up to $25,000 are now deductible on your federal return. However, these are not currently exempt from the Massachusetts state tax. You will still see these amounts included in your MA taxable income.
  • The 4% Surtax: High-income earners should be aware that for 2025, the Massachusetts 4% surtax (the "Millionaire’s Tax") applies to annual income exceeding $1,083,150. This threshold is adjusted annually for inflation.

Partner with a Certified Woman-Owned Tax Expert


Individual tax preparation for the 2025 tax year is no longer a simple data-entry task. Between the $40,400 SALT cap and the technicalities of 1099-K reporting in Massachusetts, your return requires a professional eye. At Brenda J. McGivern, P.C., we provide the expert, personal attention your household needs to file accurately and maximize your benefits by the April 15 deadline.

Don’t just file: prepare. Ready to complete your 2025 returns and start planning your 2026 tax strategy? Contact us today to schedule a session with a Certified Woman-Owned CPA firm.