Recently it feels like changes to legislation are coming out of Washington every day, and here at Visibility CFO & Tax Advisors we have been eagerly watching for what impact new legislation will have on federal taxes. This week (on Tuesday, February 25th) the House of Representatives narrowly passed a budget resolution that proposes $4.5 trillion in tax cuts (alongside a $2 trillion reduction in federal spending over the next decade).

As we approach the 2025 tax filing year it is important for taxpayers to be aware of upcoming changes.

One change we look for each year is inflation-adjusted tax brackets. The IRS has released information on its new inflation-adjusted tax brackets for 2025.  Inflation-adjusted tax brackets occur as the IRS adjusts various tax provisions in an effort to prevent "bracket creep" (when inflation pushes taxpayers into higher income tax brackets despite their purchasing power not having increased).