Schedule to Claim Tips, Overtime Tax Breaks Published by IRS

The IRS has published a new Schedule 1-A for the 2025 tax year that allows taxpayers to claim several new tax benefits introduced by the GOP’s mega tax law from last summer. These include deductions for tips up to $25,000, overtime pay, car loan interest, and an enhanced deduction for seniors.

For the tips deduction, workers must report their tips and married taxpayers must file a joint return. The overtime deduction of up to $12,500 ($25,000 for joint filers) is reduced for higher incomes and only applies to overtime required by the Fair Labor Standards Act. The car loan deduction ...