Understanding New Schedule 1-A Additional Deductions Created by the One Big Beautiful Bill Act (OBBBA)
Paul La Monaca CPA, MST
May 5, 2026
Session 1
Registration: 7:30 AM
Session 1 Begins: 8:00 AM
Session 1 Concludes: 10:40 AM
The course will review new Schedule 1-A which covers new provisions created under the One Big Beautiful Bill Act providing for:
- §224 No Tax on Tips
- §225 No Tax on Overtime
- §163(h)(4) No Tax on Car Loan Interest
- §151(d)(5) Enhanced Deduction for Seniors, and others
The course will introduce modified adjusted gross income limitations required for all four provisions, as well as the phase out of each provision based on filing status.
The course will stress, that the provisions on no tax on tips, no tax on overtime and enhanced deduction for seniors all require that a married couple must file a joint return.
The course will define what is and what is not a qualified tip as well as what is and what is not qualified overtime compensation.
The course will discuss the rules applicable for 2025 tax returns per IRS guidance in Notice 2025-62 for the employer and Notice 2025-69 for the employee versus the new filing requirements for 2026–2028.
The course will also discuss Qualified Passenger Vehicle Loan Interest and define a qualified passenger vehicle for purposes of the maximum $10,000 deduction for automobiles purchased and placed in service during 2025–2028 with final assembly in the United States.
The course will also discuss §151(d)(5), Enhanced Deduction for Seniors, and explain that the deduction is a result of a taxpayer being born before January 2, 1961, and has nothing to do with Social Security being excluded from gross income.
- The course will also discuss guidance provided by IRS and Treasury as well as the current proposed regulations that may be finalized by the time of this presentation.
- The course will summarize these new provisions and bring the total deduction from Schedule 1-A to Form 1040, line 13b in order to determine taxable income.
At the conclusion of this session, Tax Professionals will have a better understanding of how to properly prepare Schedule 1-A for tax years 2025–2028 in detail and will have an enhanced summarization of the provisions pertaining to:
- §224 No Tax on Tips
- §225 No Tax on Overtime
- §163(h)(4) No Tax on Car Loan Interest
- §151(d)(5) Enhanced Deduction for Seniors
The participants will have a better understanding of how to prepare a tax return for a taxpayer who has qualified tips, has qualified overtime compensation, has interest that pertains to qualified passenger vehicle loan interest and is allowed an enhanced deduction for seniors.
Official Registry Statement:
The National Society of Tax Professionals is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.
CTEC Disclosure Statement:
The National Society of Tax Professionals has been approved by the California Tax Education Council to offer continuing education courses that count as credit towards the annual "continuing education" requirement imposed by the State of California for CTEC Registered Tax Preparers. A listing of additional requirements to register as a tax preparer may be obtained by contacting CTEC at P.O. Box 2890, Sacramento, CA, 95812-2890, by phone toll-free at (877) 850-2832, or on the Internet at www.ctec.org.
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Disclaimer
- Course materials and presentations are intended to stimulate thought and discussion and to provide attendees useful ideas and guidance in the areas of federal taxation and administration. These materials as well as the comments of the instructors do not constitute and should not be treated as tax advice regarding the use of any tax procedure, tax planning technique, device or suggestion, or any of the tax consequences associated with them.
- Although the NSTP has made every effort to ensure the accuracy of the materials and the seminar presentation, neither the author, the presenter nor the National Society of Tax Professionals assumes any responsibility for any individual’s reliance on the written or oral information presented during the presentation. Each attendee should verify independently all statements made in the materials, and during the seminar presentation, before applying them to a particular fact pattern and should determine independently the tax and other consequences of using any device, technique, or suggestion before recommending the same to a client or implementing the same on behalf of a client, or on the attendee’s own behalf.
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