October 2025

Notable Changes for Tax Year 2025 (Income tax returns to be filed starting tax season 2026)

Leave a Comment / 1040 -Individual Tax, 2025 Tax Changes, General, IRS, Tax Credits /

💡 Notable Changes for Tax Year 2025 (Income tax returns to be filed starting tax season 2026) Standard deductions AND Marginal Tax rates:- These updates apply to income tax returns filed in 2026 (for the 2025 tax year) 🧾 Standard Deductions: *Single / Married Filing Separately: $15,000 (increase of $400 from 2024) *Married Filing Jointly: $30,000 (increase of $800 from 2024) *Head of Household: $22,500 (increase of $600 from 2024) 📊 Marginal Tax Rates (2025): The top tax rate remains 37% for: *Single filers earning over $626,350 *Married couples filing jointly earning over $751,600 Other rates and brackets: 1) 10% – $11,925 or less (single) / $23,850 or less (married joint) 2) 12% – Over $11,925 (single) / $23,850 (married joint) 3) 22% – Over $48,475 (single) / $96,950 (married joint) 4) 24% – Over $103,350 (single) / $206,700 (married joint) 5)  32% – Over $197,300 (single) / $394,600 (married joint) 6) 35% – Over $250,525 (single) / $501,050 (married joint)

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Form 3520 – Transactions with Foreign Trusts

Leave a Comment / Tax Credits /

📋 Form 3520 – Transactions with Foreign Trusts :- Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts. 📘 Purpose:- Used by U.S. persons (citizens, residents, or entities) to report certain transactions with foreign trusts or receipt of large gifts or inheritances from foreign individuals or entities. 📋 You must file Form 3520 if you: 1️⃣ Receive money or property from a foreign trust, 2️⃣ Are the owner of a foreign trust under U.S. tax rules, 3️⃣ Receive gifts or bequests from a non-U.S. person exceeding certain thresholds (e.g., $100,000 from an individual or $ 19,570 from a corporation/partnership in 2025 – limits may change each year). ⚠️ Penalty for non-filing: Up to 35% of the gross reportable amount, so timely filing is very important. 📅 Due date: Same as the individual income tax return (Form 1040) — usually April 15, with an automatic extension to October 15 if you file Form 4868.  

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FBAR (FinCEN Form 114) – Foreign Bank Account Report

Leave a Comment / 1040 -Individual Tax, FACTA / FBAR / FINCEN, IRS /

💡 FBAR (FinCEN Form 114) – Foreign Bank Account Report :-   If you are a U.S. person and your total foreign bank/financial accounts exceed $10,000 at any time during the year, you must file an FBAR. 📌 Easy-to-understand points: *Applies to all U.S. citizens, residents, and entities (LLCs, Corps, Trusts). *Includes bank, brokerage, mutual funds, pension, insurance accounts outside the U.S. *File online with FinCEN (not IRS). *Deadline: April 15 (automatic extension to Oct 15). *Report the highest balance (converted to USD). *Non-filing = heavy penalties (even if no tax is due). ✅ Example: National Bank (Pakistan): $5,000 ICICI Bank (India): $5,001 👉 Total = $10,001 → FBAR filing required. 🔑 Remember: FBAR is an information report, not a tax. The goal is transparency of offshore accounts.

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