We Do Books™ Blog

  No Tax on Overtime? What the New 2025 Overtime Deduction Really Means Beginning with the 2025 tax year, a new federal deduction may allow certain workers to reduce their federal taxable income for some overtime pay. This new rule is commonly being called No Tax on Overtime. That sounds wonderful. It also sounds much simpler than it really is, which is usually where the tax code walks in wearing muddy boots. The rule does not mean that all overtime wages are tax-free. It does not mean payroll stops withholding taxes on overtime. It does not mean the full time-and-a-half paycheck disappears from taxable income. What it means: Eligible taxpayers may be able to deduct the qualified overtime premium portion of their overtime pay on their federal income tax return. For tax years 2025 through 2028, the deduction generally applies to the portion of qualified overtime compensation that exceeds the worker's regular rate of pay, such as the half portion of time-and-a-half compensation required under the Fair Labor Standards Act, commonly called the FLSA.

Paper checks are not dead, but they are wheezing in the tax-payment ICU. For decades, taxpayers paid the IRS, state agencies, property tax offices, and other government departments by writing a check, stuffing it into an envelope, and trusting the mail, the bank, and the government’s processing system to behave like responsible adults. That was optimistic then. It is even more optimistic now. Today, federal agencies are moving toward electronic payments. The IRS has said that mailed payments, including checks and money orders, are still accepted for now, but the agency is reducing its reliance on paper payments and will continue transitioning toward electronic methods over time. The IRS also encourages taxpayers to use electronic payment options to avoid delays. That does not mean every check will create a problem. It means when a check does create a problem, the cleanup can be painfully slow, like trying to explain depreciation to a raccoon.

  The IRS Did Not Kill Lunch. It Just Made the Menu More Annoying. Business owners love the phrase “tax deductible.” The IRS loves the phrase “not so fast.” Somewhere between those two phrases sits the current mess known as the meals and entertainment deduction rules. For 2026, the rules are especially important because the old days of casuall

 1099 Reporting Just Changed for 2026 The IRS Raised the Threshold to $2,000. Here’s What Business Owners Need to Know. For years, business owners have been trained like Pavlov’s accountant: “Pay someone over $600? Issue a 1099.” That rule became so embedded into bookkeeping and tax workflows that many businesses treated it like gravity. Not necessarily because they understood it, but because fighting gravity usually ends badly. Now, beginning with payments made in 2026, the federal reporting threshold for many Forms 1099 increases from $600 to $2,000. At first glance, this sounds like welcome relief: Fewer forms Less administrative work Lower compliance burden Fewer January panic attacks involving missing W-9s But as with most tax changes, the surface simplicity hides several traps underneath. Let’s break down what changed, what did not change, and why businesses should still proceed carefully.

Paying Family Without Payroll Taxes: A SharpCFO-Level Strategy Most Advisors Miss Precision at speed. This is one of those plays that works beautifully… right up until it doesn’t. The Idea Everyone Knows… and the Part They Miss Most advisors stop at the obvious: “Put your kid on payroll.” Fine. Basic. Safe. Boring. That works great if: You’re a Schedule C Your child is under 18 You’re okay running full payroll But here’s the part almost nobody leans into: You can often pay family members — including older children — without payroll taxes at all… if structured correctly. And that’s where things go from “tax tip” to strategic tax engineering.