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The word is out: Many Americans can expect a bigger refund this tax season.

But filing your return will look a bit different this year, and the new tax breaks are just part of what changed under last year’s One Big Beautiful Bill Act (OBBBA). Between new forms and reporting rules to fewer free filing options, it’s a substantial makeover. Here’s what you need to know.

1. There are new deductions, but they may require some work to claim.

In addition to bumping the child tax credit up to $2,200, the OBBBA added several new types of “above-the-line” deductions that can be taken on top of the standard deduction (which is now $15,750 for single filers and $31,500 for married couples filing jointly). But you’ll need to use the new Schedule 1-A to claim them, and the eligibility rules and math required could get complicated.

•   Tips: Up to $25,000 in qualifying tip income.

•   Overtime: Up to $12,500 in eligible overtime pay (meaning the ‘half’ in time-and-a-half).

•   Auto loans: Up to $10,000 in interest paid on 2025 auto loans that financed eligible new vehicles made in the U.S.

•   Seniors: An extra $6,000 deduction for taxpayers 65 and older.

“The deductions and benefits are subject to complex eligibility rules, income thresholds, and phaseouts that will be difficult for many taxpayers to understand and for the IRS to administer accurately during the filing season,” Erin Collins, the National Taxpayer Advocate, wrote in her latest report to Congress.

In other words, your return may not be as straightforward as you’d like, even if you’re not itemizing. Here’s more on the parameters and income limits.

One other big change: The cap on state and local tax (SALT) deductions was raised to $40,000 from $10,000, but this only applies to those who itemize.

2. You’re less likely to get a tax form from Venmo this year. (But, you still have to report that Etsy income.)

There’s been a lot of confusion about this change, so let’s clear it up. The IRS has reinstated the old reporting requirements for Venmo, PayPal, and other payment apps. This means they won’t issue a Form 1099-K to you or the IRS unless you received over $20,000 in gross payments and had over 200 transactions. Last year the IRS had lowered the threshold to $5,000, and had planned to lower it to $600 by next tax season, but all that’s been scrapped.

However — and this is important — this change only affects who will get a 1099-K, not what is considered taxable income. Even if you don’t get a 1099-K, you still have to report any earnings you got through a payment app, even from a small, casual side gig. What you don’t need to report is when you use PayPal to send a gift of money or Venmo to split the dinner bill at a restaurant.

3. There’s a new crypto reporting form.

As digital assets become more mainstream, the IRS is moving toward more transparent, standardized reporting of transactions.

For the first time this year, U.S. brokers are required to issue Form 1099-DA to you and the IRS when you have a gain or loss on crypto, stablecoin or other tokenized assets. In other words, you have to report when you sell, exchange or redeem them for cash or property, but not when you buy or hold them without selling.

Although the IRS already required taxpayers to report these transactions, it was more of an honor system before. The new form is meant to reduce the guesswork and mistakes, and doesn’t necessarily mean your tax bill will change.

4. There’s no more Direct File.

The IRS suspended its free Direct File pilot due to low participation, so there are fewer free ways to file with software assistance. (FWIW, though, the Treasury Department said less than 0.5% of the returns filed in 2024 used it.)

If your adjusted gross income is under $89,000, however, IRS Free File is still available, or, if you’re comfortable preparing your own return, you can use the IRS’s Fillable Forms. These are essentially the electronic version of paper forms with basic math functions (but no other help.)

So what?

You can no longer afford to just check the boxes on your tax return. The OBBBA made more than 100 changes to the tax code, creating more opportunities to save money — but also to make mistakes. With many of the changes in effect through 2028, it’s worth investing the time to learn the rules.

Related Reading

The IRS Is Cracking Down on 1 Type of Income Earned by Millions of Americans (No Matter How Small) (Moneywise)

New Tax Rules Mean Bigger Refunds, but Also More Complexity (USA Today)

Tax Season Tops the List of Financial Stressors, Led by Gen Z(Intuit Credit Karma)

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