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Our team of professionals is ready to help you with your Tax Questions
It does NOT matter if:
The child has a valid SSN
The child meets every requirement
You have claimed the credit in past years
You have lived in the U.S. for years
You file taxes every year with an ITIN
****If the parents filing the tax return do not have valid SSNs, the IRS will automatically deny the Child Tax Credit for that child.****
The law requires that:
The child must have a valid SSN, AND
The taxpayer(s) claiming the credit must also have valid Social Security Numbers
If either spouse is filing with an ITIN IRS considers the household ineligible for the $2,200 Child Tax Credit.
This rule was strengthened again this year and is being strictly enforced.
Case 1: One spouse has ITIN, the other has SSN
Husband: ITIN
Wife: SSN
Child: SSN
Result: NO Child Tax Credit.
Case 2: Both parents have ITINs
Husband: ITIN
Wife: ITIN
Child: SSN
Result: NO Child Tax Credit.
Case 3: Parent files with ITIN and tries to claim the child alone
Even if the other spouse has an SSN, filing separately does NOT fix it.
Result: Still NO Child Tax Credit.
Because many families depend on their refund each year, losing a $2,200 credit per child can cause a big financial shock.
Here are the steps families should take to avoid surprises:
Adjust Your Withholding With Your Employer
If you expect to lose the Child Tax Credit, you may need to increase the amount your employer withholds from your paycheck.
What to do
– Submit a new W-4 Form to your employer
– Reduce your allowances or choose “extra withholding”
– Ask HR or payroll to help you adjust the correct boxes
– If both spouses work, both need to adjust their withholding
Why this matters
Without the Child Tax Credit, your refund may be smaller or disappear completely. Increasing withholding now helps prevent:
Large unexpected tax bills
Start Saving a Small Amount Each Month
Losing $2,200 per child can feel overwhelming.
But saving money can create a cushion for tax time.
– Create a dedicated “tax savings” envelope or bank sub-account
– Set up automatic weekly or bi-weekly transfers
– Cut 1–2 small expenses and redirect them into savings
Even small amounts add up.
Plan Ahead With a Tax Professional
Mixed-status families face complicated rules.
Meeting with a professional early can help you:
Run a tax projection
Calculate how much you might owe
Adjust your W-4 correctly
Avoid surprise bills
Understand what credits you still qualify for
Starting tax year 2025 through 2028, individuals age 65 or older can claim an additional $6,000 deduction ($12,000 if married filing jointly) on their federal income tax.
This deduction is in addition to the standard deduction (or itemized deduction) for seniors.
It phases out for modified adjusted gross income (MAGI) above ~$75,000 for single filers and ~$150,000 for married joint filers.
Purpose: The administration says this will result in ~88% of Social Security beneficiaries paying no federal income tax on their Social Security benefits.
The law does not directly eliminate federal taxation of Social Security benefits or alter the base rules of benefit eligibility.
In other words: Social Security benefit taxation rules remain in place; however, the additional deduction in many cases offsets the tax liability.
Because taxes on Social Security benefits go into the Social Security trust funds, eliminating them outright would have budget/trust-fund implications.
If you are 65+, this law could reduce or eliminate federal income tax owed on Social Security benefits particularly if you have moderate income and qualify for the deduction.
It’s still important to assess total income (pensions, part time work, investment income, etc.) since the deduction phases out above certain income thresholds.
While it’s good news for many seniors, it doesn’t change eligibility age, benefit formula, or underlying Social Security benefits, so retirement planning should still take those into account.
When employees report their tips, those tips are considered taxable income — they increase:
Federal income tax
Social Security & Medicare (FICA) tax
State income tax (in most states)
Now, workers can deduct 50% of their reported tips from their taxable income on their federal tax return.
Let’s say an employee earns:
$18,000 in hourly wages
$12,000 in tips (all reported correctly)
Previously, all $30,000 was taxed.
Now:
The employee gets a deduction for 50% of the $12,000 tips → $6,000 deduction
So, they are only taxed on $24,000 instead of $30,000
This lowers their federal income tax amount and can lower their bracket.
Applies to:
Employees who report tips (W-2 workers)
Does Not Apply To:
Owners, self-employed, or unreported (cash-in-pocket) tips.
Purpose:
Encourages legal reporting of tips, reduces tax burden on service workers.
Limitations:
150k Single
300K MFJ
Overtime pay you earn can be excluded from federal income tax:
Filing Single:
Up to $12,500 of overtime is not taxed
Married Filing Jointly
Up to $25,000 of overtime is not taxed
This means the overtime portion of your paycheck does not count toward your taxable income — up to the allowed limit.
Overtime pay you earn can be excluded from federal income tax:
Filing Single:
$150,000 Modified Adjusted Gross Income (MAGI)**
Married Filing Jointly
$300,000 MAGI
If you are 65+, this law could reduce or eliminate federal income tax owed on Social Security benefits particularly if you have moderate income and qualify for the deduction.
It’s still important to assess total income (pensions, part time work, investment income, etc.) since the deduction phases out above certain income thresholds.
While it’s good news for many seniors, it doesn’t change eligibility age, benefit formula, or underlying Social Security benefits, so retirement planning should still take those into account.
Save your last paycheck stub of the year and bring it to your tax appointment.
Put it in your wallet. Take a picture of it. Email it to yourself — just don’t lose it or throw it away.
Vehicle must weigh less than 14,000 pounds gross vehicle weight rating (meaning regular passenger / light vehicles: cars, motorcycles, vans, SUVs, pickups) and have at least two wheels.
The taxpayer’s modified adjusted gross income (MAGI) cannot exceed certain thresholds: for single filers ~$100,000; for married filing jointly ~$200,000. The deduction phases out for incomes above these thresholds and ends at ~$150,000 / ~$250,000 respectively.
The vehicle must be new, not used, and purchased for personal (not business) use.
Why it matters: Because the assembly must be in the U.S., even if the brand is “foreign,” the model qualifies if the final assembly is U.S.-based. This is intended to promote domestic manufacturing.
There is not yet a fully official IRS list publicly updated (or at least easily found) of every model that qualifies via final U.S. assembly. But multiple sources have compiled lists of vehicles whose final assembly occurs in the U.S., and so are likely eligible.
Here are examples of vehicles frequently cited as meeting the U.S. final-assembly requirement:
Honda Accord — assembled in Ohio.
Honda Civic Hatchback — assembled in Indiana.
Toyota Camry — assembled in Kentucky.
Toyota Corolla — assembled in Mississippi (for certain versions).
Chevrolet Bolt EV — assembled in Michigan.
New purchase only: Used vehicles don’t qualify.
Personal, not business use: The deduction is for vehicles purchased for personal use only (not commercial/fleet).
Income phase-out: If your MAGI is too high, the deduction phases out or is eliminated.
Verify final assembly & VIN: Because the rule depends on “final assembly in the U.S.” you may need to check the vehicle’s VIN or manufacturer/disclosure to confirm.
Weight limitation: Vehicles over 14,000 pounds gross weight do not qualify under the typical “light vehicle” threshold.
Timing: The deduction is effective starting tax year 2025 (for vehicles purchased in 2025) until 2028.
