The Bumpy Road to the Market’s Long-Term Average
Since 1926, the US stock market has rewarded investors with an annualized return of about 10%.
Filing your tax return may feel routine. But the devil is in the details, as they say, and those details have a pesky habit of shifting from year to year. The 2025 tax year is a good example. Rule changes this year include both incremental adjustments and larger shifts stemming from the One Big Beautiful Bill Act (OBBBA), passed in July. Understanding these changes now can help you maximize deductions, spot planning opportunities and avoid surprises when you file.
The OBBBA made several taxpayer-friendly provisions permanent, starting with a higher standard deduction. For 2025, the standard deduction rises to $15,750 for single filers, up from $15,000 in 2024. For married couples filing jointly, the deduction increases to $31,500, up from $30,000.
The legislation also expanded the Child Tax Credit, raising it to $2,200 per qualifying child, compared with $2,000 under prior law.
The OBBBA introduced several new deductions to be on the lookout for:
The OBBBA gave some much-needed clarity to a crucial estate planning rule. The lifetime estate and gift tax exemption was previously scheduled to sunset at the end of the year, which would have reduced the exemption from nearly $14 million to about $6 million. Instead, the higher exemption has been made permanent.
Here is where things stand now:
Beginning in 2025, the IRS now requires that crypto transactions are reported. If you sold or exchanged digital assets on a platform such as Coinbase, you should receive a Form 1099-DA. a new tax form created specifically for digital assets. Capital gains taxes may apply to crypto sales and trades. It is also worth noting that digital currencies may be taxed as ordinary income if you receive them as payment.
Your window for 2025 401(k) contributions closed at the end of the year. But if you want to pad your traditional or Roth IRA with 2025 contributions, you can do so up until the April 15 filing deadline. The contribution limit for IRAs is $7,000, but you can save an additional $1,000 if you are 50 or older.
The impact of these changes depends on your income, filing status and long-term goals. Take time now to review your situation, gather the right documentation and coordinate tax decisions with your broader financial plan to make most of the current rules. And if you have any questions, we are here to help bring clarity and confidence as you head into the filing season.
This post was written and first distributed by The Writing Company.
DISCLAIMERS
This material is intended for general public use. By providing this material, we are not undertaking to provide investment advice for any specific individual or situation, or to otherwise act in a fiduciary capacity. Please contact one of our financial professionals for guidance and information specific to your individual situation. This is not an offer to buy or sell a security.
Shore Point Advisors is an investment adviser located in Brielle, New Jersey. Shore Point Advisors is registered with the Securities and Exchange Commission (SEC). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. Shore Point Advisors only transacts business in states in which it is properly registered or is excluded or exempted from registration. Insurance products and services are offered through JCL Financial, LLC (“JCL”). Shore Point Advisors and JCL are affiliated entities.
Since 1926, the US stock market has rewarded investors with an annualized return of about 10%.
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