Tax Experts Outline 4 Major Changes to Save Money This Tax Season

Deductions on overtime pay, tips, new car purchases, and extra senior deductions could mean more money back for filers.

Published on Feb. 11, 2026

Tax experts from Volunteer Income Tax Assistance outlined four major changes in federal tax laws that could save people money when filing their 2025 taxes this year. The changes include deductions on overtime pay, the elimination of taxes on tips, deductions for new car purchases, and an extra $6,000 deduction for seniors.

Why it matters

These tax law changes aim to provide financial relief to workers, seniors, and consumers during a time of economic uncertainty. The changes could put more money back in the pockets of taxpayers, potentially boosting local economies across Minnesota.

The details

The key changes include: a deduction on the premium pay for overtime hours worked, the elimination of taxes on tips, a deduction for interest on new car loans for vehicles assembled in the U.S., and an extra $6,000 deduction for seniors with incomes under $150,000. These changes were part of a larger federal spending bill passed in 2025.

  • The new tax changes apply to the 2025 tax year, with filings and payments due by April 15, 2026.

The players

David Oeth

A representative from Volunteer Income Tax Assistance, a group offering free tax filing assistance across southeast Minnesota.

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What they’re saying

“Changes to taxes in a big federal spending bill passed last year are shaking things up this tax filing season.”

— David Oeth, Volunteer Income Tax Assistance representative (ABC 6 News)

What’s next

Taxpayers in southeast Minnesota can get free tax filing assistance from Volunteer Income Tax Assistance at locations in Rochester, Mantorville, Stewartville, and Austin.

The takeaway

These targeted tax changes aim to put more money back in the hands of workers, seniors, and consumers, potentially boosting local economies in Minnesota. The changes highlight how federal tax policy can be leveraged to provide financial relief during challenging economic times.