2025 Year In Review and Preparation for Coming Tax Season

The IRS reminds taxpayers there are things they should do before the current tax year ends on December 31.

• Identity Protection Personal Identification Number (IP PIN) - Consider obtaining an IP PIN issued by the IRS to get extra protection against identity theft during the 2026 tax season and avoid refund delays when claiming the Earned Income Tax Credit and Child Tax Credit even if your dependents are victims of identity theft.

• Review and Understand Form 1099-K if you receive one

  • Taxpayers who received more than $20,000 in payments for goods and services through an online marketplace or payment app in 2025 should expect to receive a Form 1099-K PDF in January 2026.

  • Money received as a gift or reimbursement of a share of a meal or rent should not be reported on a 1099-K. If it was, contact the payment platform (the issuer of your Form 1099-K) to correct the form, or let your tax preparer know.

  • Only business related transactions or gain from any sale of your personal assets are taxable. (Reminder: Whether or not you receive a Form 1099-K, you must still report any income on your tax return. This includes payments for any goods you sell (including personal items such as clothing or furniture sold at a gain) or services you provide.)

• Donate to Charity (review planning tips due to OBBA here)

  • Taxpayers must make any donation to a tax-exempt organization they want to deduct on their 2025 return by December 31. .

  • Consider making qualified charitable distributions from your IRA.

• Find information about retirement plans

  • Maximize your contribution to your IRA accounts. The contribution limit to all of your traditional IRAs and Roth IRAs for 2025 is $7,000 ($8,000 if you're age 50 or older), or, if less, your taxable compensation for the year.

  • Contribute salary deferral - Taxpayers can make a salary deferral to a retirement plan. This helps maximize the tax credit available for eligible contributions. Taxpayers should make sure their total salary deferral contributions do not exceed the $23,500 limit for 2025.

  • Required minimum distributions (RMDs) - Individuals who reach 73 in 2025 have their first RMD due by April 1, 2026.

• Avoid Estimated Tax Underpayment Penalty by making estimated tax payments - Individuals who receive a substantial amount of non-wage income like self-employment income, investment income, taxable Social Security benefits and in some instances, pension and annuity income should make quarterly estimated tax payments. The last payment for 2025 is due on Jan. 15, 2026.

  • Penalty rate is currently 7% annually.

  • Pay 110% of 2024 tax liability or 90% of 2025 tax liability.

• View account information online - Individuals who have not set up an Online Account yet should do so soon. People who have already set up an Online Account should make sure they can still log in successfully. Taxpayers can use Online Account to securely access the latest available information about their federal tax account.

  • Executive Order 14247 instructs the IRS to stop issuing or accepting paper checks starting 9.30.25.

  • Payment options: EFTPS, IRS Direct Pay, IRS Online Account.