Tax Update: July 2026

Trump Accounts launch July 4 — $1,000 for kids born 2025–2028

Under the 2025 tax law, the government is creating a new kind of savings account for children. If you have a child — or grandchild — who is a U.S. citizen born between January 1, 2025 and December 31, 2028 with a Social Security number, they qualify for a one-time $1,000 federal seed deposit.

Accounts go live July 4, 2026. You claim the seed by filing IRS Form 4547 with the 2025 return or registering at TrumpAccounts.gov (opens in a new tab) (there’s an official app, too). After that, family can add up to $5,000 a year. The money is invested in low-cost U.S. index funds and generally stays put until the child turns 18.

New deductions show up for the first time on your 2025 return

The 2025 tax law created several brand-new deductions you’ll see for the first time this filing season — and most can be claimed whether or not you itemize:

• No tax on tips. Deduct up to $25,000 of qualified tip income.
• No tax on overtime. Deduct up to $12,500 ($25,000 for couples) of overtime premium pay.
• Car loan interest. Deduct up to $10,000 of interest on a loan for a new, U.S.-assembled vehicle bought after 2024.
• Senior deduction. An extra $6,000 per person for those 65 and older.

Each has income limits and a few rules, and they go on a new form (Schedule 1-A). Itemizers also get a higher state-and-local-tax (SALT) cap this year.

Get an IRS notice? Don’t pay it — send it to me first

One pattern I see constantly: a client gets a letter from the IRS, understandably worries, and either pays it or calls the IRS before checking with me. Please don’t.

A surprising share of these notices are wrong, duplicated, crossed in the mail with a payment you already made, or based on information the IRS hasn’t finished processing. Paying a notice you don’t actually owe is hard to get back, and calling the IRS yourself can lock in the wrong answer. Forward it to me first, and I’ll tell you in plain English what it really is and what — if anything — to do about it.

Moved recently? Make sure the IRS has your address

The IRS mails its notices to the last address it has on file. If you’ve moved and not told them, a notice can sit in someone else’s mailbox while penalties and interest quietly build — and by the time you find out, a small issue has grown into a bigger one.

If you’ve changed addresses, especially more than once, let me know. I can file a change of address with the IRS in a few minutes so anything important actually reaches you.

Next estimated-tax deadline: September 15

If you’re self-employed, run a business, or have income with no tax withheld, your third-quarter 2026 estimated payment is due Tuesday, September 15. The easiest way to pay is IRS Direct Pay (opens in a new tab) straight from your bank.

One thing worth understanding: tax withheld from a paycheck counts as if it were paid evenly across the whole year, but an estimated payment only covers the quarter you make it. So a single year-end catch-up only fixes the fourth quarter — it won’t undo an underpayment from earlier in the year. Paying each quarter is what keeps the penalty away. (No Florida state estimate to worry about.)

A penalty notice isn’t always the final word

If you’ve been hit with an IRS penalty — late filing, late payment, a missed payroll deposit — it’s often reducible or removable, and most people don’t realize it.

A clean prior record can qualify for first-time penalty abatement, and a genuine reason (illness, a records disaster, bad advice) can support reasonable-cause relief. Before you just pay a penalty, let me take a look — there’s often money to be saved.