Every filing season, taxpayers leave money on the table — not because they’re doing anything wrong, exactly, but because they don’t know a deduction or credit exists, miss a filing detail, or rely on tax software that doesn’t ask the right follow-up questions. 2026 is a particularly good year to take a closer look at your return, because several new federal provisions under the One Big Beautiful Bill Act (OBBBA) genuinely change what a maximized refund looks like compared to just a year or two ago. Here’s a practical, jurisdiction-specific guide for Virginia and D.C. taxpayers. Start With the Basics: File Electronically and Choose Direct Deposit It sounds almost too simple to mention, but it remains the single biggest lever taxpayers control. The IRS generally issues refunds within 21 days for electronically filed returns with direct deposit, while paper returns can take significantly longer — Virginia specifically notes that mailed returns may take up to ten weeks or more to process, compared to about four weeks for e-filed returns. If getting your refund quickly matters to you, e-filing with direct deposit isn’t optional — it’s the foundation everything else builds on. New for 2026: The Senior Deduction If you’re 65 or older, don’t overlook the new additional $6,000 deduction available for tax years 2025 through 2028. This is on top of the standard deduction and any existing age-related add-ons, and it phases out at $75,000 MAGI for single filers and $150,000 for joint filers. Many seniors who’ve filed the same way for years may not realize this deduction exists yet, since it’s new for this filing cycle — worth specifically flagging with your preparer if you or your spouse qualify. The Higher Standard Deduction Helps Almost Everyone For 2026, the standard deduction increased to $32,200 for married couples filing jointly, $16,100 for single filers, and $24,150 for heads of household. If you’ve historically taken the standard deduction because your itemized deductions didn’t clear the threshold, it’s worth re-running the numbers each year rather than assuming the same choice still makes sense — especially with the SALT cap increase described below potentially tipping the math toward itemizing for some homeowners. The SALT Cap Increase Could Change Your Itemizing Decision This is one of the most significant refund-relevant changes for Virginia and D.C. homeowners specifically. The cap on deducting state and local taxes — including property taxes and either state income or sales tax — rose from $10,000 to $40,000. If you own property in Northern Virginia or D.C., where property values and property tax bills tend to run higher than the national average, you may have previously hit the old $10,000 cap well before accounting for your full state income tax and property tax liability. With the cap now at $40,000, itemizing may produce a meaningfully larger deduction than it did in recent years — even if you took the standard deduction last year. This is exactly the kind of change that’s easy to miss if you’re using the same tax software workflow you used in 2023 or 2024 without re-checking whether itemizing now makes more sense. Don’t Miss the Earned Income Tax Credit The EITC remains one of the most under-claimed credits nationally, often because taxpayers assume it doesn’t apply to them or don’t realize their income qualifies. For 2026, the maximum EITC is $8,231 for taxpayers with three or more qualifying children, up from $8,046 in 2025. If your income fluctuated this year — a job change, reduced hours, a period of self-employment — it’s worth having your preparer specifically check EITC eligibility rather than assuming last year’s non-qualification still applies. The Child Tax Credit Is Bigger This Year The Child Tax Credit increased to $2,200 per qualifying child, up from $2,000, with future amounts now indexed to inflation. The credit phases out at $200,000 MAGI for single filers and $400,000 for joint filers — thresholds that cover the large majority of DMV-area families. Charitable Giving: New Options for Non-Itemizers If you give to charity but take the standard deduction, 2026 brings a change worth knowing about: non-itemizers can now deduct up to $1,000 in cash charitable contributions ($2,000 for joint filers) even without itemizing. If you made cash donations this year and assumed you’d get no tax benefit because you don’t itemize, check this deduction specifically — it’s easy to miss since it doesn’t apply on the same line as itemized giving. If you do itemize and give more substantially, note that the 60%-of-AGI cap on cash donation deductions is now permanent, but a new 0.5% “floor” also applies — meaning very small charitable contributions relative to your income may not produce a deduction. Larger, more strategic giving — including donor-advised funds or appreciated stock donations — remains a powerful tool, but the math has shifted slightly and is worth reviewing with a professional rather than assuming prior-year rules still apply exactly. Workers Who Earn Tips or Overtime: Check Your Eligibility Two new, temporary deductions specifically target income types common across the DMV’s hospitality, restaurant, retail, and service industries: Up to $25,000 in qualifying tip income can be deducted, with phase-out beginning at $150,000 MAGI ($300,000 joint) Up to $12,500 in qualifying overtime pay can be deducted, with the same phase-out thresholds If you or a household member works in a tipped position or regularly earns overtime, this is one of the highest-value new deductions available for 2026 — but the IRS’s technical definitions of qualifying tips and overtime don’t always match the plain-English understanding of those terms, so it’s worth having a professional confirm eligibility rather than assuming. Retirement Contributions: An Underused Refund Lever Contributions to a traditional IRA can still be made for the 2025 tax year up until the April 15, 2026 federal deadline, and can reduce your taxable income even after the calendar year has ended. This is one of the few genuinely retroactive tax-saving moves available — if you haven’t maxed out your IRA contribution and have the cash available, it’s worth
Every few years, a piece of federal tax legislation comes along that touches nearly every line of the average tax return. The One, Big, Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, is one of those laws. Several of its provisions phased in for the 2025 tax year, but a substantial number take full effect starting with the 2026 tax year — the return most taxpayers will file in early 2027, though some 2026-effective provisions are already shaping estimated tax planning happening right now. Here’s a comprehensive, plain-English breakdown of what changed, organized by who it affects most, with specific notes for Virginia and D.C. taxpayers. The Big Picture: What OBBBA Did The OBBBA permanently extended most of the individual income tax provisions from the 2017 Tax Cuts and Jobs Act that were otherwise set to expire at the end of 2025. Beyond simply preventing a tax increase, it also raised several deduction and credit amounts, changed how certain deductions are capped for high earners, and made a number of previously temporary business provisions permanent. The bill touches individual brackets, business deductions, estate planning, and reporting thresholds — which is why so many different types of taxpayers are affected differently. 2026 Individual Income Tax Brackets The OBBBA made the TCJA’s rate structure permanent, and the brackets are adjusted annually for inflation. For tax year 2026, the marginal rates and thresholds are: 37% for income over $640,600 (single) or $768,700 (married filing jointly) 35% for income over $256,225 (single) or $512,450 (married filing jointly) 32% for income over $201,775 (single) or $403,550 (married filing jointly) 24% for income over $105,700 (single) or $211,400 (married filing jointly) 22% for income over $50,400 (single) or $100,800 (married filing jointly) 12% for income over $12,400 (single) or $24,800 (married filing jointly) 10% for income up to $12,400 (single) or $24,800 (married filing jointly) Standard Deduction Increases For 2026, the standard deduction rises to: $32,200 for married couples filing jointly (up from $31,500 in 2025) $16,100 for single filers and married individuals filing separately (up from $15,750) $24,150 for heads of household (up from $23,625) For most middle-income taxpayers who don’t itemize, this increase alone reduces taxable income modestly year over year. A New Cap on Itemized Deductions for Top Earners Starting with the 2026 tax year, the OBBBA introduces a new limitation for taxpayers in the 37% bracket — single filers earning above $626,350 or married couples filing jointly above $751,600. Under this cap, itemized deductions for these top earners are limited to a tax benefit equivalent to 35 cents for every $1 deducted, rather than the full marginal rate. This is a meaningful planning consideration for high-income households in the DMV area, where a significant share of federal, legal, consulting, and executive-level income falls into or near this bracket. SALT Deduction Cap Raised The cap on the state and local tax (SALT) deduction — covering income, sales, and property taxes — was raised from $10,000 to $40,000, with this higher cap indexed and extended through 2029 in some reporting. This is one of the most consequential changes for Virginia and D.C. taxpayers specifically, given the region’s relatively high property values and state/local tax burden. Homeowners in Northern Virginia who were previously capped out at $10,000 in SALT deductions regardless of actual property and income tax paid may now be able to deduct significantly more, depending on income level and whether they itemize. Child Tax Credit Increase The Child Tax Credit increased from $2,000 to $2,200 per qualifying child for 2025, with the maximum amount now indexed to inflation starting in 2026. The credit begins to phase out at $200,000 MAGI for single filers and $400,000 for joint filers. New Senior Deduction Taxpayers age 65 and older can now claim an additional $6,000 deduction, available for tax years 2025 through 2028. This deduction phases out for taxpayers with MAGI over $75,000 (single) or $150,000 (married filing jointly). This is a temporary provision — worth factoring into retirement and Social Security tax planning conversations now, while it’s available, rather than assuming it will remain in place indefinitely. No Tax on Tips and Overtime Two new, temporary deductions apply to workers who receive tip income or overtime pay: Tips: A deduction of up to $25,000 per taxpayer, with phase-out beginning at $150,000 MAGI ($300,000 for joint filers) Overtime: A deduction of up to $12,500 per taxpayer, with the same phase-out thresholds These provisions matter significantly for the DMV’s substantial hospitality, restaurant, and service-industry workforce, though eligibility and calculation rules are more nuanced than the headlines suggest — not all “tip income” or “overtime pay” as commonly understood by employees maps cleanly onto the IRS’s technical definitions. Charitable Giving Changes Starting with the 2026 tax year, charitable giving rules changed in several ways: Non-itemizers can now deduct charitable cash contributions — up to $1,000 for single filers, $2,000 for joint filers — even without itemizing. This “above the line” style deduction had not existed in this form since the pandemic-era temporary provisions expired. The 60%-of-AGI cap on itemized cash donation deductions is now permanent, having previously been scheduled to revert to a lower limit. A new 0.5% “floor” applies to itemized charitable contribution deductions — meaning a small percentage of AGI must be exceeded before charitable deductions reduce taxable income, a new limitation that didn’t exist under prior law. A new federal tax credit for contributions to “scholarship granting organizations” was created, though it isn’t available until the 2027 tax year. Energy Credits Eliminated Several energy-related credits were eliminated starting with the 2026 tax year, including the Energy Efficient Home Improvement Credit, the Residential Clean Energy Credit, and the Alternative Fuel Vehicle Refueling Property Credit (terminated for property placed in service after June 30, 2026). Homeowners in Virginia and D.C. who were planning energy efficiency upgrades, solar installations, or EV charging infrastructure with these credits in mind should revisit their timeline, since these incentives are no longer available under current law. 1099 Reporting
Tax-exempt status is not the same thing as filing-exempt status. It’s one of the most common misconceptions nonprofit leaders bring to their first meeting with our firm, and it’s an expensive one to hold onto — because missing a Form 990 filing doesn’t just mean a late fee. It can mean losing your organization’s tax-exempt status entirely. This guide walks Virginia and D.C. nonprofit leaders through exactly what’s required for the 2026 filing year, which form applies to your organization, and how to avoid the mistakes that most often trigger IRS scrutiny. Why Nonprofits Still Have to File — Every Year Most tax-exempt organizations recognized under Section 501(c)(3) or a related exemption category must file an annual information return with the IRS regardless of how much revenue they bring in. The purpose isn’t just tax accounting — Form 990 is a public disclosure document. Donors, watchdog organizations like GuideStar and Candid, prospective funders, and journalists can and do read it. A sloppy or late 990 doesn’t just risk IRS penalties; it can quietly damage the trust your organization has spent years building. When Is Form 990 Due in 2026? Form 990 is due on the 15th day of the 5th month following the end of your organization’s accounting period. For organizations on a standard calendar tax year (January 1 – December 31), that means Form 990 is due May 15, 2026 for the 2025 tax year. If your organization operates on a different fiscal year — say, a school or arts organization with a July-to-June fiscal year — your due date shifts accordingly. For example, organizations with a fiscal year ending March 31, 2026 have a Form 990 due date of August 17, 2026. If the 15th falls on a weekend or federal holiday, the deadline moves to the next business day — which is exactly what happens in November 2026, since November 15 falls on a Sunday, pushing certain extended deadlines to November 16 or 17 depending on the specific due date rule applied. Extensions Organizations that can’t meet the original deadline can file Form 8868 for an automatic six-month extension. For calendar-year organizations, filing Form 8868 by May 15, 2026 extends your Form 990 deadline to November 16, 2026. Unlike some IRS extensions, this one is genuinely automatic — you don’t need to explain why you need more time, but you do need to file it before the original deadline passes. There’s no way to request an extension after the original due date has already come and gone. Which Form 990 Variant Does Your Organization File? Not every nonprofit files the same version of Form 990. The correct form depends on your organization’s gross receipts and total assets: Form 990-N (e-Postcard): For organizations with gross receipts normally $50,000 or less. This is a brief electronic filing with basic organizational information. There’s technically no penalty for filing this one late, but missing it for three consecutive years still triggers automatic revocation of tax-exempt status. Form 990-EZ: For organizations with gross receipts under $200,000 and total assets under $500,000. This is a shorter version of the full return. Form 990 (long form): Required for organizations with gross receipts of $200,000 or more, or total assets of $500,000 or more at year-end. This is the full 12-core-page return plus applicable schedules, and it’s the version most mid-size and larger nonprofits will file. Form 990-PF: Required for private foundations regardless of financial size. Form 990-T: An additional filing required if your organization has unrelated business income (UBI) — income generated from activities outside your primary tax-exempt purpose. Larger nonprofits budget significant time for the full Form 990 — often 40 to 60 hours of preparation depending on organizational complexity, since it requires detailed financial data, program descriptions, governance disclosures, and compensation information for officers, directors, and key employees. The Three-Year Rule: A Deadline You Cannot Afford to Miss This is the single most consequential compliance rule in nonprofit tax filing: if your organization fails to file its required Form 990 for three consecutive years, its tax-exempt status is automatically revoked — no warning letter, no grace period, no case-by-case review. The IRS does not reverse this revocation quietly or easily. Reinstatement typically requires filing a new exemption application and, in many cases, paying the associated fee again, along with demonstrating reasonable cause for the lapse. If your nonprofit has any uncertainty about whether recent filings were completed — a leadership transition, a change in bookkeeping staff, or a gap during a slow period — it’s worth confirming your filing history directly with the IRS or a CPA before assuming everything is in order. Late Filing Penalties Penalties for filing Form 990 late or incompletely can add up quickly. The IRS imposes penalties starting at $20 per day for smaller organizations (those with gross income under a specified threshold), and penalties can, in certain circumstances, be assessed against responsible individuals personally — a detail that has caught board members off guard when they assumed filing was “someone else’s job.” Electronic filing systems generally have a cutoff time of 5:00 PM Eastern, so don’t count on a midnight deadline the way you might with some other filings. Political Activity: A Growing Area of Scrutiny Section 501(c)(3) organizations are absolutely prohibited from participating in political campaigns and are limited in permissible lobbying activity. Form 990 asks direct questions about political and lobbying activity, and answering these questions incorrectly — even unintentionally — can trigger an IRS examination or jeopardize exempt status. Given the heightened scrutiny nonprofit political activity has received in recent years, this section of the form deserves careful, deliberate review rather than a quick check-the-box approach, especially for organizations engaged in advocacy or issue-based programming. Nonprofit Compliance Beyond Form 990 Federal filing is only one piece of nonprofit compliance. Organizations operating in Virginia and D.C. should also be aware of: Independent financial audits and reviews. Many funders, state charitable solicitation registrations, and internal governance policies require an independent audit, review, or compilation