Heading into 2025: Tax Strategy Moves You Shouldn’t Ignore to Reduce 2025 Taxes

2025 isn’t just another tax year—it’s the year where Congress dropped the “One Big Beautiful Bill Act” (OBBBA) and shook some of the rules that many of us had been banking on.

If you’re reading this while sipping your third coffee (I don’t judge), here’s what your 2025 tax playbook should include:

What Changed (And What Stayed) Under OBBBA

Before we talk strategy, here’s a quick refresher on the new tax terrain. (Yes, even tax nerds need a map sometimes.)

Item	New Rule / Change	Why It Matters
Standard deduction bump	Single: $15,750 Head-of-household: $23,625 Married filing jointly: $31,500	Bigger floor—less room for creative deductions to beat standard.
Child Tax Credit	$2,200 per child (indexed going forward)	More relief for parents.
SALT cap increase	Up to $40,000, but with a phase-out starting at $500,000 MAGI	Could bring more taxpayers back to itemizing.
Tip & overtime deductions	New deductions (below the line) for qualifying tips (cap $25,000) and overtime (cap $12,500)	Non-itemizers can now get deductions too—but careful with the rules.
Car loan interest deduction	Up to $10,000 interest on new post-2024 U.S.-assembled auto loans	Applies even if you don’t itemize. Phase-outs begin at moderate MAGI levels.
Senior (65+) deduction	$6,000 deduction (phasing out) for those 65+	A small cushion for older taxpayers.
Business / bonus depreciation	100% bonus depreciation for property placed in service after Jan 19, 2025; research & experimental (R&E) deduction back to 100%	A big positive for business investments.
Interest limitation rule reversion	Back to original rules: limit on deduction based on earnings before interest, taxes, depreciation & amortization (EBITDA)	Could reduce interest deductions for leveraged businesses.
Clean energy credits sunset	Several vehicle and commercial clean energy credits end as early as Sept 2025; others end Dec 2025	Push any eligible projects now or risk losing them.

In short: Some of your old tricks are dead, others are resurrected, and a few brand-new hooks are in play.

Strategic Moves to Reduce Tax in 2025

Let’s get to the fun part: how to game this (legally) to your advantage.

1. Re-evaluate itemizing vs standard deduction

• The standard deduction has been juiced substantially. Many taxpayers who itemized last year will find that their total deductions no longer exceed the standard.

• But with the SALT cap now $40,000, more filers (especially high property tax states) might find itemizing attractive again—if their mortgage interest, state taxes, charitable contributions, etc., push them over the standard threshold and reduce 2025 taxes.

• Keep in mind the SALT phase-out at $500,000 MAGI, which may limit your ability to get full value.

  
  

You should: Run a side-by-side scenario of standard vs hypothetical itemized deductions in Q4 2025 and decide whether to “front-load” charitable giving, state payments, etc.

2. Use new below-the-line deductions wisely

Because some new deductions (tips, overtime, car loan interest, senior deduction) are “below the line,” they don’t reduce your AGI. That’s a mixed blessing.

• You get the benefit even if you don’t itemize.

• But since they don’t reduce AGI, they may not help you qualify for income-based credits or phase-ins.

You should: Track qualifying tip and overtime separately; structure auto purchases to qualify for the car loan interest deduction. (Make sure the vehicle is assembled in the U.S. and meets other requirements.) Accounting Today

3. Accelerate or delay deduction timing

• With the 100% bonus depreciation available for qualifying property you place in service after Jan 19, 2025, consider shifting capital investments into 2025 to get full deductibility.

• Conversely, because some clean energy credits sunset late in 2025, if you’re planning a solar project, EVs, or energy retrofits, aim to execute them before the relevant deadlines.

• If your income is volatile, defer or accelerate income or expenses across 2025 and 2026 in light of your expected marginal tax rates.

You should: Plan capital purchases (machinery, qualified property) now vs later and align with credit / deduction expiration dates.

4. Revisit your pass-through strategy and QBI deduction

• The 20% Qualified Business Income (QBI) deduction is now permanent, and thresholds have increased (single: $75,000; joint: $175,000) with a new minimum deduction floor of $400 (if QBI ≥ $1,000).

• But the benefit still phases out depending on income, type of business, and W-2 wages / property. If you’re near the threshold, consider optimizing W-2 compensation or restructuring entity types to maximize the deduction.

You should: Model where your taxable income will land relative to the phase-outs; consider reorganizing entity structure or adjusting compensation.

5. Pay attention to interest deduction rules

• The business interest expense limitation returns to the original rules tied to EBITDA. That’s more restrictive for highly leveraged businesses.

• If your interest deductions are being constrained, see whether restructuring debt, prepaying interest, or reducing leverage makes sense.

You should: Forecast your interest deduction under the new rules and determine whether debt restructuring or early payoff is helpful.

6. Leverage refundable credits and new credits

• The adoption credit (now refundable up to $5,000) provides new opportunity for families pursuing adoption.

• If you’re expecting to claim clean energy credits, plan those project timelines carefully before sunset dates.

• For education spending, the 529 plan now covers more things (tutoring, test fees, dual enrollment, etc.) starting mid-2025.

You should: Evaluate whether you can sync qualifying expenses with the expanded 529 rules. If adoption is on your horizon, lock in those expenses.

Things to Watch (Because we don’t trust Congress or the IRS)

• The IRS has already said it will not adjust withholding tables for the 2025 enhanced standard deduction. So many taxpayers who take advantage of it will only feel the benefit at tax time—not via larger paychecks.

• Because several of these new deductions are “below the line,” they won’t reduce AGI, potentially interfering with phase-ins or eligibility for some credits or repayment plans for education debt.

• The IRS will likely need to issue guidance on how to report tips, overtime, car loan interest, etc., because existing forms (1040, W-2) aren’t changed yet. ExFed Tax is prepared to issue a public comment letter on October 1, 2025 for the current proposed list. More to come.

• Clean energy, EV, and other credits have sunset dates in 2025. If you mis-time your project, you might lose most of the benefit.

• Tax planning in late 2025 might hit a snag if IRS guidance is lagging (and given staffing/resource constraints, that’s a real possibility).

Final Thoughts (Yes, I’ll wrap up)

2025 is less a reset and more a partial reboot of the tax code. The OBBBA didn’t just extend stuff—it added, curtailed, and rearranged many incentives. If you approach 2025 with your eyes open, there’s real opportunity to minimize liabilities legally.

For ExFed Tax, this means working closely with clients now to model different tax scenarios, locking in investment timing, and spotting new deductions before guidance lags behind.

You should: Contact ExFed Tax soon to discuss tax year 2025 and evaluate your strategies.