December is a great time to make smart, proactive tax moves—especially with several big reporting changes and expiring incentives coming into focus for 2025 and beyond. Below are five timely updates and planning ideas you should know as we head into the new year.
Upcoming Dates to Know
As you plan for the start of the year, here are a few key dates and reminders to keep on your calendar:
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January 15 — 4th quarter installment of 2025 estimated income tax is due for individuals.
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January 19 — Martin Luther King Jr. Day.
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Begin tax filing for 2025
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Organize tax documents (W-2s, 1099s, 1098s, and other records)
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Schedule a tax appointment for document drop-off or a meeting
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Begin tax planning for 2026
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Create a budget
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Adjust your withholdings
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Rebalance investment portfolios
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1) Form 1099-DA Is Here—What It Means for Your Crypto Taxes
After four years of development, the IRS has finalized cryptocurrency reporting rules, and crypto tax reporting officially begins with the 2025 tax year. Starting in 2025, custodial crypto platforms must report taxable crypto transactions directly to the IRS.
Who must report?
The reporting responsibility falls on “digital asset brokers”—businesses that take custody of customers’ digital assets when those customers sell or exchange them. This includes:
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Centralized trading platforms such as Coinbase, Kraken, and Binance
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Hosted (custodial) wallet providers
Most crypto transactions flow through these brokers, which means more taxpayers will receive standardized IRS reporting.
What will be reported?
Brokers must file a new form: IRS Form 1099-DA, Digital Asset Proceeds From Broker Transactions. The form will report:
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Customer’s name, address, and taxpayer identification number
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Name and quantity of the digital asset sold
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Sale date
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Gross proceeds amount
Brokers must file the first Forms 1099-DA for the 2025 tax year by March 31, 2026.
Gross proceeds first; cost basis later
For 2025 only, brokers report gross proceeds—the total value you receive when you sell or exchange crypto, before fees and other costs. Beginning in 2026, brokers must also report your cost basis (your original acquisition value plus associated costs).
The big upside: Form 1099-DA should make it easier to calculate crypto gains and losses when you file your return.
Planning tip: understand FIFO vs. specific identification
The IRS rules also clarify how crypto owners determine the basis of their units:
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FIFO (first in, first out) is the default method.
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FIFO often creates higher taxable gains during rising markets because it uses the oldest, often lowest-basis, units first.
If you want more control, you can use specific identification, which lets you choose the exact units you’re transferring. For 2025, transitional rules allow you to use specific identification in your own records without notifying your broker.
Important new recordkeeping rule
If you hold crypto across multiple wallets or exchanges, you must track cost basis separately for each wallet/account. You can no longer treat your crypto as though it’s all sitting in one combined account. If you held crypto in multiple accounts on January 1, 2025, you must allocate unused basis to the specific accounts where each asset is held.
Takeaway: Better reporting is coming—but accurate personal recordkeeping still matters.
2) Only Seven Months Left to Secure Your EV Charger Credit
A valuable federal tax credit for installing electric vehicle chargers and other alternative-fuel refueling equipment is set to expire soon.
You can still claim the credit, but it disappears for any equipment placed in service after June 30, 2026.
How much is the credit?
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Generally 30% of the cost of qualifying equipment.
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Personal use at your principal residence: up to $1,000, if your home is located in an eligible census tract.
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Business use: credits can be much larger—up to $100,000 per item.
Businesses can increase the rate from 6% to 30% by meeting specific wage and apprenticeship requirements.
Location matters—a lot
Strict location rules now block many taxpayers from qualifying. The equipment must be placed in service in:
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A low-income census tract, or
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A non-urban census tract
These tracts cover roughly 97% of the U.S. land mass, but the credit is still limited by eligibility boundaries.
What costs can count?
For larger installations—especially businesses with fleets or multiple ports—properly allocating costs can significantly increase the credit. Eligible costs may include:
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Chargers
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Pedestals
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Electrical panels
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Wiring
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Smart-charge management systems
How to claim it
You claim the credit on IRS Form 8911:
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Business credits flow to Form 3800
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Personal credits flow to Schedule 3 of Form 1040
You must also reduce the equipment’s basis by the credit and follow recapture rules if the equipment stops qualifying.
Takeaway: If you’re considering installing EV charging equipment at home or for your business, now is the time to evaluate eligibility and plan for maximum credit.
3) Do Pass-Through Entity Taxes Still Pay Off After OBBBA?
If you own a business organized as a pass-through entity—such as a partnership, S corporation, or multimember LLC—you may have an important choice to make: Should you elect pass-through entity tax (PTET)?
Why PTET became popular
The 2018 Tax Cuts and Jobs Act capped personal itemized deductions for state and local taxes (SALT) at $10,000.
PTET elections allow the business entity—not the owner—to pay state income taxes on pass-through income. Because those taxes are treated as a business expense, the entity can deduct them on its federal return, sidestepping the personal SALT limitation.
Most states with income taxes now allow PTET elections, and the IRS has approved the approach.
What changed under the One Big Beautiful Bill Act (OBBBA)?
The OBBBA did not eliminate or restrict PTETs. However, it raised the SALT cap to $40,000 for tax years 2025 through 2029.
That raises an obvious question: If I can deduct more SALT personally, do I still need PTET?
Why PTET may still be valuable
PTET can still offer meaningful benefits, including:
1) Help for high-income taxpayers
The $40,000 SALT cap phases down when modified adjusted gross income (MAGI) exceeds $500,000. Taxpayers above $600,000 get only a $10,000 deduction.
2) Lower federal and self-employment taxes
When the entity pays and deducts state taxes, it reduces pass-through income, lowering:
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Federal income taxes, and potentially
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Self-employment taxes (12.4% Social Security up to the wage base and 2.9% to 3.8% Medicare tax)
3) Lower AGI and related planning benefits
Lower AGI may help you:
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Avoid certain surtaxes
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Qualify for deductions with AGI floors
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Preserve deductions and credits that phase out at higher AGI levels
Potential downside
PTET can reduce your 20% qualified business income (QBI) deduction because it lowers taxable income from the business.
Takeaway: PTET remains optional and potentially powerful—even with the higher SALT cap—but it’s highly fact-specific. Running the numbers is essential.
4) The Hidden Benefits of Filing a Gift Tax Return
Here’s a surprise for many taxpayers: Most people who file gift tax returns do not pay gift tax.
Gift tax returns are filed by the giver, not the recipient. Even if no tax is due, filing can be required and can offer important protections.
The lifetime exemption is high
Each individual has a lifetime gift and estate tax exemption of $13.99 million (for 2025). Married couples can effectively double this amount.
When you must file
You generally must file a gift tax return when you make a “reportable gift,” such as:
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Giving any one person more than the annual exclusion amount ($19,000 in 2025)
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Electing to split gifts with your spouse
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Making gifts of future interests (e.g., certain trust transfers)
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Front-loading multiple years of 529 plan contributions
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Making certain gifts to your spouse
If required to file, you also need to report charitable gifts made during the year (even though they don’t reduce the lifetime exemption).
Important filing logistics
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Gift tax returns are due when your income tax return is due.
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They must be filed separately on paper.
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Joint gift tax returns do not exist—each spouse files individually.
Why filing matters even when no tax is due
Filing a gift tax return starts the three-year statute of limitations for the IRS to challenge your valuations. Without a filed return, the IRS can challenge values without time limit.
Takeaway: A gift tax return isn’t just a formality—it’s a valuable documentation and protection tool.
5) IRS Moves Toward All-Electronic Refunds
The IRS has announced it will stop issuing refund checks (with limited exceptions) and move to all-electronic refunds.
Why the IRS is doing this
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Paper checks cost more
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They create security risks
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They take longer to process
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The federal government has been directed to eliminate paper check payments
What stays the same
You will still file your tax return the same way. The change affects how refunds are delivered.
How you can receive your refund
The fastest and most reliable option is direct deposit. About 93% of taxpayers already use it, and they won’t be affected.
If you currently receive paper checks, you should switch to direct deposit for your 2025 return by entering your routing and account numbers on the return.
If you prefer not to use a bank account, you may be able to use:
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Certain mobile apps, or
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Prepaid debit cards that provide routing and account numbers
The IRS may still issue a paper check if you qualify for a waiver due to limited access to banking or electronic payments—but paper checks can take at least six weeks, while electronic refunds typically take about 21 days.
Takeaway: If you prefer paper checks, start planning now for an electronic alternative.
Final Thoughts: Take Action Before the Year Ends
Tax planning is most valuable when it’s done proactively—before deadlines arrive and options disappear. If any of the topics above apply to you (crypto reporting, EV charger installation, PTET planning, gifting, or refund delivery changes), it’s worth reviewing your situation now.
If you’d like help evaluating these strategies, confirming eligibility, or running the numbers, we’re here to help.