Tax News Roundup - December 2025
Important tax news you need to know
This month’s Tax News Roundup reviews the following news items:
Working Families Tax Cuts
Trump Account Guidance Released
Health Savings Accounts Guidance Released
2026 Retirement-Related Inflation-Adjusted Amounts
Recent Disaster Postponements
Automatic First Time Abate Starting Next Year (paid subscribers)
Scholarship Granting Organization Credit Guidance Released (paid subscribers)
Stock Repurchase Final Regulations Issued (paid subscribers)
Working Families Tax Cuts
If you see the IRS or politicians refer to “Working Families Tax Cuts,” it is simply a political rebranding of the One Big Beautiful Bill Act (OB3 Act). The IRS is now using the former term in press releases, but retaining the latter term in official guidance.
Trump Account Guidance Released
In Notice 2025-68, the IRS provided initial guidance on §530A Trump Accounts. The IRS will issue proposed regulations consistent with the notice.
A Trump account is a type of traditional IRA with special rules prior to the tax year in which the beneficiary turns 18. Taxpayers can elect to open a Trump account for a child and elect to receive the $1,000 pilot program payment by filing Form 4547, Trump Account Election(s), with their 2025 Form 1040.
Michael Dell recently announced his foundation would contribute $250 to the Trump accounts of 25 million American children aged 10 and under living in ZIP codes with median incomes below $150,000.
Health Savings Account Guidance Released
In Notice 2026-05, the IRS provided initial guidance on changes to health savings accounts (HSAs) due to the OB3 Act. The IRS will issue proposed regulations consistent with the notice.
Starting in tax year 2026, §71307 of the OB3 Act permitted health savings account (HSA) contributions if an individual is enrolled in a bronze-level or catastrophic plan on the Health Insurance Marketplace.
Starting in 2026, §71308 of the OB3 Act added direct primary care service arrangement (DPCSA) expenses as qualified medical expenses for HSA purposes. In addition, a DPCSA will not be treated as another health plan if the aggregate fees for all DPCSAs with respect to such individual for such month do not exceed $150 ($300 if it covers more than one individual).
Important areas of clarification include:
A bronze plan or catastrophic plan purchased off-Exchange on the individual market will be treated as a high deductible health plan (HDHP) if the same plan is available as individual coverage through an Exchange. That requirement is treated as met if the individual has no reason to believe that the bronze or catastrophic plan is not available on an Exchange.
Fees for a DPCSA that do not satisfy the monthly dollar limit will be treated as medical expenses reimbursable from an HSA but will disqualify the covered individual from eligibility for making HSA contributions while the individual is enrolled (because it is treated as a health plan).
2026 Retirement-Related Inflation-Adjusted Amounts
In Notice 2025-67, the IRS released retirement-related inflation-adjusted amounts for 2026. Of note: the maximum IRA contribution increases to $7,500, plus an additional $1,100 if the individual is age 50 or older. The catch-up is now inflation adjusted thanks to the SECURE 2.0 Act.
Recent Disaster Postponements
MO-2025-03: Parts of Missouri
Deadlines starting March 30, 2025 postponed to March 30, 2026
Previously late-filed 2024 returns may now be timely under this relief because it was issued later than normal.