Key Takeaways
- 72.5 cents per mile for business auto use.
- OBBBA tops tax policy hits for 2025.
- Home sale gain boost for 2026?
- Green credits that expire in 2026.
- Data center taxes.
- The problem with postmarks.
- Friendly free tax advice can be costly.
- National Bacon Day.
IRS Sets Standard Mileage Rate for 2026 at 72.5 Cents - Eide Bailly:
IRS Increases 2026 Business Mileage Rate, Cuts Medical And Moving Rates - Kelly Phillips Erb, Forbes:
2025 Greatest Tax Policy Hits
Top Federal Tax Policies Of 2025 - Asha Glover, Law360 Tax Authority ($):
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Among the bill's many tax changes, it allows projects to receive full energy tax credit values under current Inflation Reduction Act rules through Dec. 31, 2027. It also extends and boosts the state and local tax deduction cap to $40,000 with annual increases until 2030, when it will return to the current $10,000 cap. It retains the current ability for all pass-through entities to claim the SALT deduction at the entity level, which would have been barred under the House of Representative's version of the bill.
The other top policy items listed were the lapse of ACA enhanced tax credits, the talk of a "revenge tax" that would address allegedly unfair foreign trade practices; IRS and Treasury tax staffing; and IRS guidance on OBBBA.
Looking to 2026: Home Gains and Expiring Energy Credits
Two Bills, and Maybe Trump, Favor Raising Tax Cap on Home Sales - Doug Sword, Tax Notes ($):
Even if the political atmosphere is too tense to support a bipartisan tax bill in an election year, there are still must-pass vehicles that could carry a tax title, and House Ways and Means Committee member Jimmy Panetta, D-Calif., is eyeing them for his effort to double the capital gains exclusion on home sales.
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The $250,000 cap for single homeowners and $500,000 for married ones has been around since 1997 — unadjusted for inflation — and there have been bills to change that since 2005.
More Clean Energy Credits Are Set to Expire in 2026 Under OBBBA - Katie Lobosco, Tax Notes ($):
The section 45L new energy-efficient homes tax credit will terminate for property acquired after June 30, 2026. It’s available to eligible contractors that build or substantially reconstruct energy-efficient single- or multifamily homes and is worth up to $5,000 per home. The credit was originally scheduled to expire at the end of 2032.
The section 179D energy-efficient commercial buildings tax deduction will end for property that has not begun construction by June 30, 2026. Since the IRA, the amount of the deduction has been equal to the lesser of the cost of the installed property or the maximum savings per square foot, indexed annually for inflation. The IRA had made the deduction permanent.
The section 30C alternative fuel vehicle refueling property tax credit is scheduled to expire for property placed in service after June 30, 2026. The credit is available to businesses or individuals that install alternative fueling equipment in qualifying low-income, nonurban communities and is worth up to 30 percent of the cost.
Related: Eide Bailly Energy Incentive Program Services.
What if Tariffs are Struck Down?
Donald Trump expected to impose new levies if Supreme Court strikes down tariffs - Aime Williams, Financial Times:
Markets traders are braced for turmoil if the US’s top court rules against Trump, potentially leaving the federal government on the hook for billions of dollars in repayments of levies that have already been collected.
But diplomats and trade lawyers believe the administration has a series of plans in place to shore up the levies regardless of the court’s ruling, using a combination of existing trade measures alongside alternative laws.
Hawaii Tax Cruises
Hawaii Cruise Ship Tax Survives, but Its Voyage Will Be Stormy - Tom Yamachika, Bloomberg ($):
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For now, the tax remains standing and will take effect as planned. But the devil’s in the details—and those may yet sink the tax as the industry and the government continue their assaults. Meanwhile, one wonders why so much public money is being spent on marketing Hawaii as a tourist haven if the state government is more focused on milking the tourists like cattle.
Taxing Data Centers
Data Centers Are Heavily Taxed. How Much is Too Much? = Jared Walczak, The SALT Road. "Texas does quite well, with 429 data centers. But states that really punch above their weight (in addition to Virginia) include Oregon, Iowa, Montana, Nevada, North Dakota, Arizona, Wyoming, and Ohio. Each state has its own advantages."
The Problem With Postmarks
U.S. Postal Service Postmark Rules’ Implications for Tax Filings - Leslie Book, Tax Notes ($):
One key point that the preamble discusses is that the postmark date does not necessarily align with the date that someone drops off a properly addressed envelope at the post office.
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Most prudent advisers will likely mail important documents to the IRS using certified mail with a return receipt or via an authorized private delivery service. Despite the best practice of using certified mail or other forms of mailing that provide documentary proof that an item has been mailed, most documents filed with the IRS are sent via traditional first-class mail, and that is why these new U.S. Postal Service rules are so important.
Blogs and Bits
Ways to spend your FSA money so you don’t lose it - Kay Bell, Don't Mess With Taxes. "Any deductible or added costs for that tooth cleaning you put off until the last minute qualifies for FSA coverage. So do the prescription pain meds your dentist gives you if your procedure is more major, and ache inducing."
Another Trip Around the Transfer Pricing Sun: Four Bold Predictions for 2026 - Chad Martin, Eide Bailly. "It's hard to make predictions – especially about the future. Today we indulge in the late-December tradition of throwing Yogi Berra’s wise words to the wind, as we wrap up the year in transfer pricing with a few squints into the crystal ball."
S Corporation Can't Deduct Asset Acquisition Costs as Cost of Goods Sold - Parker Tax Pro Library. "The Tax Court held that an S corporation, operating as a telecommunications service provider, could not treat as cost of goods sold payments that it made to acquire assets of a business in bankruptcy that was owned by several of the S shareholders."
IRS collection shifts shape as technology and courts tighten options - Tax Coda. "Collection has used predictive scoring for years to determine who is likely to pay and at what cost. What is changing is speed and scale."
Related: Eide Bailly Dispute Resolution and Collections Services.
The Value of Friendly Advice
Don't Let Friends Take Tax Advice From Friends! - Manasa Nadig, The Buzz About Taxes:
Sound familiar? This is the moment the bridge question becomes relevant.
The court’s response was sharp. The judges basically said: Your friends’ opinions don’t override what Schedule B explicitly asks you to do. And here’s the kicker—the fact that the Horowitz’s were even having these conversations meant they were aware of their compliance obligations. They just chose to have those conversations with friends instead of with tax professionals.
The article explains how that turned out to be costly for the taxpayers. No matter how convincing and confident your friends at the airport or golf course are about their tax tips, run them by your tax pro first.
Related: Eide Bailly Offshore Voluntary Disclosure Services.
What day is it?
It's National Bacon Day! I can't believe we have to work today.
Make a habit of sustained success.
