Imperial Financial Services

02/27/2026

The average individual tax refund was up nearly 11% in the first 10 business days of the 2026 filing season, rising to $2,290 from $2,065 last year.

01/23/2026

The Treasury Department and the IRS confirmed that the supplemental basic allowance for housing payments made to members of the uniformed services in December 2025 are not taxable for federal income tax purposes. These one-time payments, authorized by Congress to help offset rising housing costs, were distributed to active-duty and eligible reserve service members in pay grades O-6 and below.

Under federal tax law, basic allowance for housing payments is considered a qualified military benefit and is excluded from gross income. As a result, service members who received the supplemental housing payment do not include it in taxable income and do not report it on their federal tax return.

01/22/2026

Larger Tax Refunds Are Coming This Filing Season

Tax season begins next week: When taxpayers file their 2025 returns this year, many will see noticeably larger refunds than in recent years—up to $1,000 higher on average.

The One Big Beautiful Bill Act (OBBBA) reduced individual income taxes for 2025, but because the IRS didn't adjust withholding tables after the law passed, workers generally continued to withhold more taxes from their paychecks than the new law required.
As a result, instead of gradually receiving the benefit of the tax cuts through higher take-home pay during the year, most taxpayers will receive it all at once when they file their returns.

01/11/2026

The 2026 tax filing season will open Jan. 26, the IRS said Thursday. The IRS will have about 25% fewer workers than a year ago and new tax provisions to handle.

The date for the IRS to start accepting and processing tax returns is in line with previous years, including 2025 (Jan. 27) and 2024 (Jan. 29).

The provisions of H.R. 1, P.L. 119-21, commonly known as the One Big Beautiful Bill Act, could affect federal taxes, credits, and deductions, the IRS said in a news release. Treasury Secretary and Acting IRS Commissioner Scott Bessent said he was “confident in our ability to deliver results and drive growth for businesses and consumers alike.”

The IRS expects to receive about 164 million individual tax returns during the 2026 season, in line with the 163.6 million received as of Oct. 17, 2025. While April 15 is the deadline to file individual returns and pay any tax due, taxpayers can get a filing extension until Oct. 15. Most taxpayers will file electronically, the IRS said.

Taxpayers can use the Where’s My Refund? link to track the status of refunds.

Meanwhile, the IRS encouraged taxpayers to establish a bank account to receive their tax refunds by direct deposit because the IRS is phasing out paper tax refunds due to an executive order.

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01/10/2026

IRS news release IR-2025-128 and Notice 2026-10 announce that the optional standard mileage rate for business use of an automobile will increase by 2.5 cents starting January 1, 2026, to 72.5 cents per mile. Standard mileage rates in effect for 2026 are as follows:

Business miles: 72.5 cents/mile (increased from 70 cents)
Depreciation element: 35 cents (increased from 33 cents)
Medical/moving miles: 20.5 cents/mile (decreased by 0.5 cents)
Charitable miles: 14 cents/mile (set by statute)

These rates are in effect until further notice.

The maximum value of an employer-provided vehicle first made available in 2026 is $61,700 (increased from $61,200 in 2025). This amount applies for purposes of fleet-average valuation and cents-per-mile valuation calculations for automobiles, trucks, and vans.

12/07/2025

The work opportunity tax credit (WOTC) will sunset at the end of 2025, making it critical for tax professionals to discuss in client conversations. The credit rewards employers for hiring individuals from 10 targeted groups, including veterans, SNAP recipients, temporary assistance for needy families (TANF) recipients, ex-felons and long-term unemployed workers. To qualify, employees must start work before Jan. 1, 2026.

The WOTC can provide significant tax savings. Employers generally receive a credit equal to 40% of up to $6,000 in first-year wages for qualified employees working at least 400 hours, up to $2,400 per hire. Hires of people from groups, like veterans and long-term family assistance recipients, may allow for higher credits. As part of the general business credit, unused credits may be carried back one year or forward up to 20 years, broadening the planning potential.

For tax-exempt employers, the credit applies only when hiring qualified veterans and is claimed against the employer’s Social Security tax using Form 5884-C, Work Opportunity Credit for Qualified Tax-Exempt Organizations Hiring Qualified Veterans. To secure the credit, employers must pre-screen new hires with Form 8850, Pre-Screening Notice and Certification Request for the Work Opportunity Credit, on or before the job offer date and submit it to the state workforce agency within 28 days of the employee’s start date. Review this valuable credit with your clients today.

12/06/2025

On Nov. 25, 2025, President Donald Trump signed the IRS Math and Taxpayer Help Act (H.R. 998) into law, a bipartisan effort that strengthens taxpayer rights and improves transparency in IRS communications. The new law, led by Ways and Means members Randy Feenstra and Brad Schneider, requires the IRS to clearly show its math when it makes changes to a taxpayer’s return.

For years, millions of math error notices have gone out with little to no explanation, leaving taxpayers confused and often unaware that they had only 60 days to challenge the adjustment. Under the new requirements, the IRS must provide a straightforward description of the error and an itemized computation showing the exact calculation behind any changes. This added clarity gives taxpayers a fair chance to respond and provides practitioners with the details they need to advocate effectively.

12/06/2025

Trump Accounts created under OBBBA will function as a new, IRA-like account for minors (not a traditional IRA at the outset), established for eligible individuals under age 18 when the account is opened. Contributions can be made by the child’s parents/guardians and other individuals, employers under certain plans, and potentially other entities, as guidance is finalized. During the growth period, funds can be invested only in eligible mutual funds or exchange-traded funds (ETFs) (subject to further IRS/Treasury guidance on which funds qualify), and distributions are generally not permitted until the child turns 18. At that point, the account transitions to a standard traditional IRA and follows regular IRA rules moving forward.

The annual contribution limit for a Trump Account is its own annual limit under the Trump Account rules, giving families an additional planning opportunity. The Treasury Department will also launch a pilot program that provides a one-time $1,000 contribution for qualifying children born in years 2025 through 2028. The election to establish a Trump Account for calendar year 2026 may be made on IRS Form 4547, Trump Account Election(s), (once the final version is released) at any time, including at the same time that the 2025 income tax return is filed, or through the online tool or application. The online tool or application used to make the elections is expected to be available on trumpaccounts.gov in the middle of 2026.

Additionally, the IRS has requested comments on several key issues, including who may establish an account, investment requirements, trustee qualifications and the coordination of contributions from multiple sources. Tax professionals working with families may want to start evaluating how Trump Accounts fit into long-term savings and retirement strategies for minor children.

12/01/2025

December 31 will be here before you know it. Please lock in so you don’t have the repeated disaster results at tax preparation time.

11/20/2025

Do you know how much you should have in your savings account? Here’s a few tips.

Let me know what you think or questions in the comments

11/16/2025

The annual contribution limit for employees who participate in 401(k), 403(b), governmental 457 plans, and the federal government’s Thrift Savings Plan is increased to $24,500, up from $23,500 for 2025.

The limit on annual contributions to an IRA is increased to $7,500 from $7,000. The IRA catch‑up contribution limit for individuals aged 50 and over was amended under the SECURE 2.0 Act of 2022 (SECURE 2.0) to include an annual cost‑of‑living adjustment is increased to $1,100, up from $1,000 for 2025.

The catch-up contribution limit that generally applies for employees aged 50 and over who participate in most 401(k), 403(b), governmental 457 plans, and the federal government’s Thrift Savings Plan is increased to $8,000, up from $7,500 for 2025. Therefore, participants in most 401(k), 403(b), governmental 457 plans and the federal government’s Thrift Savings Plan who are 50 and older generally can contribute up to $32,500 each year, starting in 2026. Under a change made in SECURE 2.0, a higher catch-up contribution limit applies for employees aged 60, 61, 62 and 63 who participate in these plans. For 2026, this higher catch-up contribution limit remains $11,250 instead of the $8,000 noted above.