5 tips to trim your 2025 taxes
As 2025 draws to a close, Oregon State Credit Union is offering five year-end tax tips to help you save money on this year’s taxes and prepare for 2026.
“We’re always looking out for our members’ financial wellness, and taxes are a big factor in every budget,” said Ashley Wilson, Community Education Director of Oregon State Credit Union. “Making small changes before Dec. 31 can make a big difference on April 15.”
Here are five tips from Oregon State Credit Union to help maximize your 2025 tax deductions and credits before the end of the year:
1. Time your state and local tax payments carefully
- Before December 31, 2025: If you plan to itemize deductions this year, pay your Oregon state income taxes and property taxes before year-end to take advantage of the current $10,000 federal deduction limit.
- Looking ahead to 2026: The federal deduction limit for state and local taxes will increase to $40,000 for couples filing jointly. If you expect to itemize next year, consider delaying some payments until January to benefit under the higher limit.
2. Use new worker deductions and keep records for next year
- Before December 31, 2025: If you earn tips, work overtime, or recently financed a car, you may qualify for new federal deductions that reduce your taxable income. Keep detailed records of your tip income, overtime pay, and car loan interest so you can claim them again next year.
- Looking ahead to 2026: These deductions will continue through 2028, so plan to continue keeping these records for the next few years.
3. Complete energy-efficient home improvements
- Before December 31, 2025: Finish upgrades like insulation, windows, or installing a heat pump to qualify for up to $3,200 in federal tax credits.
- Looking ahead to 2026: The credit resets each year, so plan additional improvements for next year to claim another round. Make sure products meet federal energy standard.
4. Claim family-based credits and adjust your paycheck withholding
- As of December 31, 2025: Oregon will offer a new credit for families with young children, and the IRS will offer a federal credit for working families with low to moderate income. If you have children under age five as of December 31, 2025, you will qualify for this credit.
- Looking ahead to 2026: File your 2025 tax return to claim these new credits. The federal credit for children will increase slightly due to inflation. Update your paycheck withholding in January to reflect your expected credits and avoid surprises at tax time.
5. Contribute to retirement and Oregon savings accounts
- Before December 31, 2025: Maximize contributions to retirement accounts and Oregon’s college or disability savings plans to reduce your taxable income and qualify for state credits.
- Looking ahead to 2026: Federal contribution limits will increase slightly. Plan to raise your savings rate early in the year to take full advantage.
These tax tips have been prepared for informational purposes only and are not intended to provide and should not be relied on for, professional or individual tax, legal or accounting advice. Be sure to consult your own tax, legal and accounting advisors regarding your own specific circumstances.
For more financial tools and support, visit Oregon State Credit Union’s online financial wellness center or one of its local branches.
