Time for Change

While every tax season certainly comes with at least minor differences from the one before, there are certain years that are especially challenging. Case in point: President Donald Trump’s first administration, when the Tax Cuts and Jobs Act (TCJA) was enacted and resulted in an overhaul of the Internal Revenue Code.

Kirsten Toler, CPA, of KMT Consulting, LLC, personally knew many seasoned CPAs who made 2018 their final tax season and retired because of the emotional and mental toll it took.

“TCJA was really unique in a lot of ways and it affected what I felt myself, what I saw in CPAs who were senior to me, and what I saw in our staff,” she says. “We were really slammed by that, and we had to learn so much.”

That experience has made Toler more optimistic about her ability to adapt to this year’s changes brought on by the One Big Beautiful Bill Act (OBBBA). South Jersey Biz spoke to her and Jo-Ann Weiner, a forensic tax accountant at J.L. Weiner & Associates, about what business owners and individuals can expect.

Toler: “For individuals, anyone over 65 now has, depending upon their income level, the potential of getting a senior credit, which is $6,000 per person. If a married couple is filing a joint return and both of them are over 65, they get a $12,000 tax credit. The credit is not refundable, meaning that it reduces the amount of tax that might be owed, but if it completely wipes out the tax that would be owed, you don’t get anything that’s left over back in your pocket.

“There is also a change for those who itemize their deductions. The old Tax Cuts and Jobs Act set a cap of $10,000 on real estate tax and income tax deduction as part of the itemized calculation. That was bad for people in New Jersey, notably, because our real estate taxes are so high and our income tax rates are higher. … For 2025, the One Big Beautiful Bill Act increased that cap to $40,000. So when we were doing projections for clients at the end of the year, those … who have higher income tax rates and potentially higher real estate taxes, we were able to look and say, ‘Wow, they’re going to be able to itemize this year.’ While the standard deduction increased again, which it does every year, this additional amount from the cap being increased benefitted a lot of people.”

Weiner: “There has been a lot of personnel turnover at the IRS and along with that an effort is being made to utilize AI for tasks. These pivots are leading to many changes in how effectively the IRS is doing things and how quickly they are doing them. For example, a revenue officer who collects unpaid taxes due may have 100 cases in his or her inventory to collect on. That revenue officer can only send out so many delinquency letters a day. Now, by using AI, they can push a button and send 100 letters out immediately. So, as you can imagine, things are moving quicker. Couple that with the fact that since a lot of the IRS employees are newer, they are not as experienced—that means taxpayers must know their rights and the proper next step to resolve tax controversies and balances due. The addition of AI means our response times are collapsed, which makes for a quick turnaround on our end. That’s why it’s very important to make sure you read everything in any letter you receive from the IRS, respond timely and consider calling a professional like me for guidance.”

Toler: “The thing that specifically affected small business owners is that once again they are making bonus depreciation available for business assets that were purchased in September of 2025 through Dec. 31. … The bonus depreciation through the Tax Cuts and Jobs Act was phased out and was technically supposed to sunset at the end of 2025. But since the current administration is the one that put that into place in the first place in 2018, they pushed through the OBBBA to let it continue permanently. As a result, bonus depreciation is once again at 100%, where it had slowly phased to lower percentages over the years as the Tax Cuts and Jobs Act would have sunsetted. The bonus depreciation is a benefit to a lot of businesses that have qualifying assets. There were also changes with what is considered qualified property for this bonus depreciation, so some businesses were able to take advantage of that too.”

Weiner: “We start by determining the facts of the matter to identify the issue. I have a client who represented himself previously, and each person he talked to at the IRS told him a different thing to do. Of all the different options he tried, none were effective. Once we identify the issue, the next thing is to figure out what the risk is, what the consequence of that risk might be, and from my experience of more than 45 years, what the best solution is.

“We check the big picture and search for realistic solutions. Is the client eligible for any penalty relief? Are there any statute expirations that exist? Are there liens or levies or garnishments looming? Is the client qualified for an installment or a partial pay installment agreement? Can we get an offer in compromise? You have to know when to pivot, when to use which program and how to leverage your client’s position. We are looking for ways to find a solution that keeps you whole, and there are lots of different ways to do that.”

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