2025 Tax Credit Expirations: What You Need to Know and How to Prepare

The end of 2025 is shaping up to be a pivotal moment for taxpayers. Several valuable tax credits and provisions are set to expire, and without congressional action, these changes could significantly impact individuals, families, and businesses starting in 2026.

At Kamish & Associates, we’re committed to helping you navigate these changes and take advantage of opportunities before the window closes. Here’s what’s expiring and how it could affect you.

1. Clean Energy Tax Credits

Expiring December 31, 2025:

• Residential Clean Energy Credit – 30% credit for qualified home energy improvements such as solar panels and geothermal systems.

• Energy Efficient Home Improvement Credit – Up to $1,200 annually for energy-efficient upgrades like insulation, windows, and doors.

• Clean Vehicle Credits – Available for new and used electric vehicles, ending September 30, 2025.

Impact: If you’ve been considering home upgrades or purchasing an electric vehicle, acting before the deadline could mean thousands in savings.

2. Enhanced ACA Premium Tax Credits

The expanded subsidies that make health insurance more affordable under the Affordable Care Act are set to end in 2025. Without an extension, premiums could rise sharply for millions of Americans starting in 2026.

Impact: Clients who rely on ACA marketplace plans should prepare for potential increases and plan enrollment strategies early.

3. TCJA Provisions Could Sunset

Key provisions from the 2017 Tax Cuts and Jobs Act are scheduled to expire at the end of 2025, including:

• Lower federal income tax rates across most brackets.

• Expanded standard deduction.

• Increased Child Tax Credit.

• $10,000 SALT (state and local tax) deduction cap, which could change.

Impact: Without renewal, tax rates may rise, and deductions could shrink, especially for middle- and upper-income earners.

4. Child Tax Credit Adjustments

For 2025, the Child Tax Credit increases to $2,200 per child. However, stricter income phase-outs and Social Security number requirements will reduce eligibility, particularly for mixed-status households.

Impact: Families may see reduced credits and should review their eligibility before year-end.

5. Other Notable Expirations

• Work Opportunity Tax Credit (WOTC) – Expires December 31, 2025, affecting businesses that hire from targeted groups.

• Energy Project Deadlines – Some clean energy construction credits require projects to start by mid-2026 or be operational by the end of 2027.

How This Affects You

• Homeowners: Consider completing qualifying energy projects or EV purchases before the credits end.

• Families: Review health coverage options and tax credit eligibility.

• Businesses: Plan for potential loss of hiring credits and prepare for changes in tax rates.

  
  

Bottom Line

2025 is a planning year. Acting now can help you lock in tax benefits before they expire and prepare for a potentially different tax landscape in 2026.

At Kamish & Associates, we’re here to create a tailored strategy for you - whether it’s maximizing credits, adjusting withholdings, or planning investments. Let’s talk before the clock runs out.