The federal income tax filing deadline isn’t until April. However, the start of tax season is nearly upon us. Here are some tips for navigating the tax filing process to help lessen some of the stress you may feel as Tax Day arrives.
Gather up and organize your tax documents.
Compile your tax documents and organize them. Print off digital documents so they are all together (unless you are e-filing) for a more manageable filing year.
Determine your filing status.
Your filing status is the rate at which income is taxed. There are five filing statuses: single, married filing separately, married filing jointly, head of household, and qualifying widow(er) with dependent child filing status.
Check if you qualify for tax exemptions, deductions, or credits
Tax deductions – Tax deductions reduce your taxable income, potentially lowering the tax you owe. A few examples includemedical expenses, property taxes, and charitable contributions.
Tax exemption – Tax exemptions include income or transactions that are free from tax at the federal, state, or local level. These include some non-profits, specific veterans (for example, disabled veterans), and income from some types of investments like municipal bonds or 401(k)s.
Tax credit – Tax credits directly reduce the amount of your tax bill. There are either refundable or nonrefundable credits. Examples include the earned income tax credit (refundable) and saver’s credit (nonrefundable).
Consider filing electronically (e-File).
The IRS has partnered with several companies to provide electronic filing to the public. Some of these options include TurboTax, H&R Block, and TaxSlayer.
Consult a financial professional.
A financial professional can work with you to get the most benefit from your tax filing.
Tax Rates
For the 2025 tax year, according to the IRS, the tax rates are as follows:
2025 Tax Rate Single Filers Married Filing Jointly Head of Household
10% $0 to $11,925 $0 to $23,850 $0 to $17,000
12% $11,925 to $48,475 $23,850 to $96,950 $17,000 to $64,850
22% $48,475 to $103,350 $96,950 to $206,700 $64,850 to $103,350
24% $103,350 to $197,300 $206,700 to $394,600 $103,350 to $197,300
32% $197,300 to $250,525 $394,600 to $501,050 $197,300 to $250,500
35% $250,525 to $626,350 $501,050 to $751,600 $250,000 to $626,350
37% $626,350 or more $751,600 or more $626,350 or more i
More tax rate information for 2025:
The Alternative Minimum Tax exemption, which impacts approximately 0.8% of the U.S. population, goes into effect if income is above the annual AMT exemption amount. This generally applies to taxpayers with high incomes, ensuring these taxpayers pay at least the minimum tax amount owed. Their tax is calculated under regular tax rules and AMT rules, and they pay the higher amount of the two. For 2025, the AMT exemption amount is $88,100 ($68,650 for married individuals filing separately) and starts to phase out at $626,350 ($137,000 for married couples filing jointly whose phase out begins at $1,252,700).ii
The Earned Income Tax Credit amounts for qualifying taxpayers in 2025 are as follows:
Children or Filing as single, head of household Married filing jointly
relatives claimed married filing separately or widowed
Zero $19,104 $26,214
One $50,434 $57,554
Two $57,310 $64,430
Three $61,555 $68,675
Investment income limit: $11,950 or less
Maximum credit amounts
The maximum amount of credit:
No qualifying children: $649
1 qualifying child $4,328
2 qualifying children $7,152
3 or more qualifying children: $8,046
To qualify, you must meet the basic rules:
Must be a U.S. citizen or resident alien for the entire year.
Have a valid social security number by the due date of your 2025 tax return.
Have an earned income through working under $68,675.
Have investment income of $11,950 or less in the 2025 tax year.
Will not file form 2555 for foreign earned income.iii
Qualify for the rules of separation from your spouse and not filing a joint tax return.
* There are also special qualifying rules for members of the military, clergy, and taxpayers and their relatives with disabilities.
The monthly limitation for the qualified transportation fringe benefit and qualified
parking is $325.iv
The dollar limitation for employee salary reductions for contributions to health flexible spending arrangements is $3,300.v
For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount is $660.vi
For participants with self-only coverage in a Medical Savings Account, the plan must have an annual deductible that is not less than $2,800 and not more than $4,150. The maximum out-of-pocket expense amount for self-only coverage is $5,550.
For family coverage in a Medical Savings Account, you can contribute up to $4,300 if you are covered by a high-deductible health plan just for yourself, or $8,550 if you have coverage for your family. Those 55 and older who are not enrolled in Medicare can contribute an additional $1,000 as a catch-up contribution The out-of-pocket maximum including annual deductible does not exceed $8,300 for self-only coverage and $16,600 for family coverage.vii
The foreign-earned income exclusion is $130,000.viii
The lifetime gift and estate tax exemption amount is now $13,990,000 (this amount may significantly decrease after Dec. 31, 2025, when the Tax Cuts and Jobs Act sunsets unless policymakers extend these provisions).
The annual gift exclusion is now $19,000.ix
The maximum credit allowed for adoptions is the qualified adoption expenses up to $17,280.x
The Lifetime Learning credit applies to individuals who are enrolled in an eligible educational institution (colleges, universities, or technical schools offering education beyond high school) and taking eligible courses (those that improve or acquire job skills). You can claim the full $2,000 if you are single with a (MAGI) of up to $80,000 or $160,000 for joint filers (beyond this limit, the credit phases out).
The personal exemption remains at 0 (line 5 of your 1040, which states that you want the most amount of tax taken out of your pay each pay period). If you put 1, for example, less taxes are withheld from your paychecks, so you get more money now with a smaller refund.
There is no limitation on itemized deductions.
Protecting Yourself from Tax Identity Theft
Identity theft is a severe problem in today’s technological world. To help mitigate the risk of identity theft, consider taking these steps:
Secure your devices.
Always keep your devices on your person or in a secure location, and ensure your passwords are strong.
Keep your social security number private.
Criminals steal your social security number in an attempt to obtain credit or even a job in your name.
Regularly monitor your accounts.
Monitoring your accounts on a regular basis can help you recognize if someone is using your identity to file a fake tax return to claim a fraudulent refund. They may also use this information to get a job or claim your child as a dependent on a phony return.
Beware of phishing.
Phishing involves people sending emails or other messages posing as a family member, friend, or legitimate company to attempt to steal information. Never click on links or open emails from anyone you don’t know.
Only go to a tax preparer you trust.
Be sure only to get tax help from a legitimate tax preparer.
Regularly change your passwords.
Changing your passwords often and ensuring you aren’t repeating them for multiple accounts helps to prevent identity thieves from gaining access to your personal information.
Respond to IRS notices.
The IRS may send letters 4883C or 6330C asking you to verify your identity. Call the toll-free number provided in the letter to help keep your identity secure. Until the IRS hears from you, they won't be able to process your tax return, issue refunds, or credit any overpayments to your account.
Consult a financial professional.
A financial professional can help you take the necessary steps to keep your information out of the hands of identity thieves and provide guidance for a more manageable and efficient tax filing.
Important Disclosures:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This article was prepared by LPL Marketing Solutions
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