The Internal Revenue Service (IRS) updates many things every year to make up for the cost of living, inflation, and soaring prices. However, some items have not been adjusted. While you may have already seen the notable changes that will take effect in the 2025 tax year, you may be happy to know what remains unchanged.
Bear in mind, that by statute, specific items that were indexed for inflation in the past are presently not adjusted. As a matter of fact, there are three important items that have remained unchanged.
IRS items that will not change in the 2025 tax year
First of all, the itemized deductions will remain the same. Another thing that will not change will be the personal exemptions for the tax year 2025. The third thing without changes will be lifetime learning credits.
So let’s go through them to see what the current levels are.
- Itemized deductions: Once more, “there is no limitation on itemized deductions” as in tax year 2024. Bear in mind that the limitation on itemized deductions was withdrawn in 2027. Thanks to the Tax Cuts and Jobs Act from that year. So, it has remained unchanged since 2018.
IRS personal exemptions and Lifetime learning credits
- Personal exemptions have also remained unchanged: The 2025 tax year will also have the personal exemptions at 0, just like it was in the tax year 2024. This is another example of the elimination introduced by the 2017 Tax Cuts and Jobs Act.
- Lifetime learning credits: For your information, the Lifetime Learning Credit is phased out for taxpayers with modified adjusted gross income in excess of $160,000 for joint returns and $80,000 for single filers. Therefore, the modified adjusted gross income amount used by American taxpayers to see the reduction in LLC is not adjusted for inflation for taxable years starting after December 31, 2020.
Anyway, it is also important to check the things that have changed if you have not done so yet.
Source: https://www.irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2025