Last minute tax tips for your 2025 return

The April 15 deadline is less than two weeks away. Whether you have already filed your 2025 tax return or are still pulling documents together, this year deserves a closer look. The One Big Beautiful Bill Act, signed into law on July 4, 2025, introduced several new deductions and changed others retroactively for the 2025 tax year. Many filers may not realize they qualify for these new breaks, and some who already filed may have missed them entirely.

Here are the most important things to check before the deadline passes.

New deductions you may not know about

The One Big Beautiful Bill Act (OBBBA) brought the most significant tax changes since the 2017 Tax Cuts and Jobs Act. Several provisions apply retroactively to the 2025 tax year, meaning they affect the return you are filing right now.

A higher standard deduction. The OBBBA permanently increased the standard deduction beyond the normal inflation adjustment. For 2025, the standard deduction is $15,750 for single filers, $23,625 for heads of household, and $31,500 for married couples filing jointly. If you are using tax software from earlier in the season, make sure it reflects these updated numbers.

A much larger SALT deduction. This is the big one for New Yorkers. The OBBBA raised the state and local tax (SALT) deduction cap from $10,000 to $40,000 for the 2025 tax year. If you live in a high-tax state and have been capped at $10,000 for years, you may now be able to deduct significantly more of your state income and property taxes. This change alone could push some filers from the standard deduction into itemizing. The full $40,000 cap applies if your modified adjusted gross income is $500,000 or less, after which it phases down. The cap reverts to $10,000 in 2030, so this window is temporary.

No tax on tips. Workers in occupations that customarily receive tips can now deduct up to $25,000 in qualified tip incomefrom their federal taxable income. The deduction phases out for single filers with modified AGI over $150,000 ($300,000 for joint filers). You will claim this on the new Schedule 1-A, a form created specifically for these new deductions.

No tax on overtime. A similar deduction exists for qualified overtime pay. You can deduct the premium portion of overtime compensation — the “half” in “time-and-a-half” — up to $12,500 ($25,000 for joint filers). Since employers were not required to report overtime separately on 2025 W-2 forms, you may need to use your pay stubs to calculate the amount.

A new senior deduction. Taxpayers aged 65 and older can claim an additional $6,000 deduction ($12,000 for married couples where both spouses qualify). This stacks on top of the existing standard deduction and the existing additional standard deduction for seniors. It phases out for individuals with modified AGI over $75,000 ($150,000 for joint filers).

Car loan interest. If you purchased a new vehicle for personal use in 2025, you may be able to deduct up to $10,000 in loan interest. The vehicle must be new (not used), and the deduction phases out for individuals with modified AGI over $100,000 ($200,000 for joint filers). Lease payments do not qualify.

Why you should reconsider itemizing this year

The combination of a higher SALT cap and these new deductions means that many filers who took the standard deduction in previous years should run the numbers again. Before the OBBBA, the $10,000 SALT cap made itemizing impractical for many middle- and upper-middle-income households. With the cap now at $40,000, your property taxes plus state income taxes alone might exceed the standard deduction, especially if you live in New York, New Jersey, Connecticut, or California.

Even if you have already filed using the standard deduction, it may be worth comparing what you would have owed had you itemized instead. If the difference is meaningful, you can file an amended return using Form 1040-X.

You still have time to fund an IRA or HSA

One of the most overlooked last minute tax tips for 2025 is that the deadline to make IRA and HSA contributions for the 2025 tax year is the same as the filing deadline: April 15, 2026. A filing extension does not extend this deadline.

For traditional IRAs, the 2025 contribution limit is $7,000 ($8,000 if you are 50 or older). If you qualify for a deductible contribution, every dollar you put in reduces your taxable income dollar for dollar.

For HSAs, the 2025 limits are $4,300 for individual coverage and $8,550 for family coverage, with an additional $1,000 catch-up for those 55 and older. HSA contributions are deductible whether you itemize or take the standard deduction, the funds grow tax-free, and withdrawals for qualified medical expenses are tax-free. If you had qualifying high-deductible health plan coverage in 2025, you can still contribute now and designate it as a 2025 contribution. Just make sure you specify the correct tax year with your provider.

How your investments affect your tax return

Tax season is a good time to look at how your investment portfolio interacted with your tax situation over the past year.

Review your tax-loss harvesting. If you sold investments at a loss during 2025, those losses can offset capital gains and up to $3,000 of ordinary income. Check that your return properly reflects any harvested losses. If you use a brokerage that does automated tax-loss harvesting, verify the numbers against your 1099-B.

Consider concentrated stock positions. Holding a large position in a single stock can create tax planning challenges. If you sold shares during 2025, make sure you understand which cost basis method was used and whether you triggered short-term or long-term capital gains. If you are sitting on a large unrealized gain, this is a good moment to think about how that position fits into your broader financial plan, especially as you plan ahead for 2026.

Check how your dividends were classified. Not all dividends receive the same tax treatment. Qualified dividends are taxed at the lower long-term capital gains rate, while ordinary dividends are taxed as regular income. Your 1099-DIV breaks this out, but it is worth checking that your return reflects the classification correctly. If a significant portion of your dividend income came from ordinary dividends, that may be worth addressing in future years. Restructuring a portfolio toward investments that generate more qualified dividend income can meaningfully reduce your tax burden over time.

If you have already filed

If you have already submitted your 2025 return and realize you missed one of these new deductions, you have options. You can file an amended return using Form 1040-X to claim a deduction you overlooked. The IRS generally allows amended returns within three years of the original filing deadline. Given the volume of new provisions this year, the IRS likely expects a higher-than-usual number of amendments.

There is no penalty for amending your return to claim a larger refund or reduce a balance due. However, the process can take several months. If you owe additional tax, interest accrues from the original due date.

Planning ahead matters more than scrambling at the deadline

Many of the most effective tax strategies happen throughout the year, not in the final weeks before filing. Tax-loss harvesting, retirement account contributions, charitable giving, and income timing all work best when they are part of an ongoing plan.

At Magnifina, we take a fundamentals-driven approach to individual stock investing. By focusing on business quality and valuation rather than tracking broad indexes, we help our clients build portfolios that are more deliberate and, in many cases, more tax-efficient. Concentrated index positions and forced turnover inside funds can create tax consequences that investors do not always see coming. A thoughtfully constructed portfolio of individual stocks gives you more control over when gains are realized and how income is classified.

If that approach sounds interesting, see if we’re a good fit — it’s just 4 questions.