Did you know?

You can put up to $24,500 of your pay into a 401(k), 403(b) or TSP in 2026. At 50 or older you can add $8,000, and at ages 60 to 63 you can add $11,250 (up to $35,750 in all).

Work for yourself with no employees? A solo 401(k) lets you save $24,500 as the "employee" and add an employer contribution on top, for up to $72,000 in total before catch-up. A SEP-IRA has the same top limit.

A SEP-IRA can be opened and funded as late as your tax filing deadline, including extensions. That makes it one of the best last-minute ways for a self-employed person to lower the tax bill.

You can put $7,500 in an IRA for 2026, or $8,600 if you are 50 or older, and you have until the April 2027 filing deadline to do it.

A SIMPLE IRA is an easy retirement plan for a small business. Employees can defer $17,000 in 2026, $21,000 at 50 or older, and $22,250 at ages 60 to 63.

An HSA is taxed in your favor three times: money goes in tax-free, grows tax-free and comes out tax-free for medical costs. The 2026 limit is $4,400 for self-only and $8,750 for family coverage, plus $1,000 if you are 55 or older.

A defined benefit or cash balance plan can let a business owner with steady, high income put away far more than a 401(k) allows, especially after 50. The yearly benefit limit for 2026 is $290,000.

New in 2026: if your Social Security wages from the employer that sponsors your 401(k) were over $150,000 in 2025, your catch-up contributions must go in as Roth (after-tax) money.

If your income is modest, the saver's credit can cut your tax bill by up to $1,000 ($2,000 for a couple) just for saving for retirement. For 2026 it reaches incomes up to $40,250 single and $80,500 joint.

When you work for yourself you pay both halves of Social Security and Medicare tax: 15.3% on net earnings up to $184,500 in 2026, and 2.9% above that. Half of it is deductible on your return.

The qualified business income deduction can take up to 20% off the tax on pass-through business income. The 2025 law made it permanent and added a $400 minimum deduction if you have at least $1,000 of qualified income.

Estimated taxes are due four times a year: April 15, June 15, September 15 and January 15. Paying 100% of last year's tax (110% if your income was over $150,000) usually protects you from the underpayment penalty.

The business mileage rate rose to 76 cents a mile on July 1, 2026 (it was 72.5 cents from January to June). A simple log of dates, miles and purpose is what turns miles into a deduction.

Tips, overtime and car loan interest can now be deducted even if you do not itemize. The tips deduction is up to $25,000, overtime up to $12,500 ($25,000 joint), and car loan interest up to $10,000.

Work from home regularly and exclusively for your business? The simplified home office deduction is $5 per square foot, up to 300 square feet, which is up to $1,500.

If you are self-employed, the health insurance premiums you pay for yourself, your spouse and your dependents may be deductible even if you do not itemize, up to your net profit.

In 2026 a business can deduct up to $2,560,000 of equipment it buys and uses, in the year of purchase. And 100% bonus depreciation is now permanent for property acquired after January 19, 2025.

You only have to send a 1099-NEC or 1099-MISC to a contractor you paid $2,000 or more in 2026. It used to be $600. Still collect a W-9 from every contractor before the first payment.

S corporation owners who work in the business must pay themselves a reasonable salary. Too low, and the IRS can recharacterize distributions as wages and charge payroll tax and penalties.

Illinois lets partnerships and S corporations elect to pay Illinois tax at the entity level. The owners can then get a federal deduction that works around the $40,400 cap on state and local taxes.

Startup costs for a new business: up to $5,000 can be deducted in the first year and the rest over 15 years, so keep every receipt from before opening day.

Business meals are generally 50% deductible when they are directly related to your business and you keep the receipt and a note of who attended and why.

Good news for U.S. companies: since August 14, 2026 they no longer have to file beneficial ownership reports with FinCEN. Only foreign companies registered to do business in the U.S. still report.

Pay your child a reasonable wage for real work in your sole proprietorship and the wages can be a business deduction. Under 18, no Social Security or Medicare tax is withheld, and their standard deduction can shelter the wages from income tax.

Payroll taxes you withhold belong to the government from the moment you take them out of a paycheck. If they go unpaid, the IRS can hold the owner personally liable for the full amount.

Late payroll tax deposits can bring penalties of up to 15%. Payroll taxes are due on a fixed schedule, and the penalty grows the longer a deposit is late.

Hiring someone who works from another state usually means registering for that state's withholding and unemployment taxes before their first paycheck. We handle payroll in every state.

Not filing costs ten times more than not paying: 5% of the unpaid tax per month (up to 25%) against 0.5% per month. If you cannot pay, still file on time.

An extension to file is not an extension to pay. Pay what you expect to owe by the original due date to avoid penalties and interest.

You may qualify for IRS first-time penalty abatement if you filed and paid on time for the past three years. Ask before you pay a penalty.

A Notice of Deficiency gives you 90 days (150 if you are outside the U.S.) to challenge the IRS in Tax Court before the tax is assessed. The date is on the letter and it cannot be extended.

You generally have three years from the date you filed to claim a refund. Old returns with missed deductions can still pay off.

The IRS generally has three years to audit a return, and six years if more than 25% of income was left off. Keep your records at least that long.

Renting out your home for 14 days or fewer in a year? The rent is generally tax-free, and you do not even have to report it.

You deduct the cost of a residential rental building over 27.5 years, even though it may be rising in value. Land is not depreciable. A cost segregation study can speed up the deductions.

If you actively manage your rental, you may deduct up to $25,000 of rental losses against other income. The allowance shrinks to zero between $100,000 and $150,000 of income.

Selling your main home? You may exclude up to $250,000 of gain ($500,000 if married filing jointly) if you owned and lived in it for at least two of the last five years.

If your foreign bank and financial accounts total more than $10,000 at any time in the year, you generally must file an FBAR. It is due April 15, with an automatic extension to October 15. An honest mistake can still cost more than $16,000 per late report.

Received a large gift or inheritance from abroad? Gifts over $100,000 from a foreign individual in a year generally must be reported on Form 3520, even though they are not taxable. The late-filing penalty starts at 5% a month.

Form 8938 and the FBAR are not the same thing. They have different thresholds, are filed in different places and some people must file both.

U.S. citizens and green card holders owe U.S. tax on income from anywhere in the world, wherever they live. The foreign tax credit and the foreign earned income exclusion ($132,900 in 2026) help avoid paying twice.

Many mutual funds sold outside the U.S. (including in India) are treated as passive foreign investment companies. They need an extra form every year, and the tax rules can be harsh.

The 2026 standard deduction is $16,100 for single filers, $32,200 for married filing jointly and $24,150 for heads of household. Age 65 or older? There is an extra deduction, plus the new $6,000 senior deduction.

New in 2026: even if you take the standard deduction, you can deduct up to $1,000 of cash gifts to qualified charities ($2,000 for a married couple).

For 2026, long-term capital gains are taxed at 0% on income up to $49,450 (single) or $98,900 (married filing jointly) of taxable income. Hold investments more than a year to qualify.

You can give up to $19,000 to any one person in 2026 without filing a gift tax return, and you can give to as many people as you like.

On October 1, 2026 Treasury opened a Trump Account for every eligible child under 18. A parent must claim it in the official app before the $1,000 government deposit (for U.S. citizen children born 2025 to 2028) or any gifts can arrive.

If you sell a stock at a loss and buy the same or a substantially identical one within 30 days before or after, the loss is generally disallowed for now.

Every federal income tax return asks whether you received or sold digital assets such as cryptocurrency. Keep records of every transaction.