The IRS has clarified how the One Big Beautiful Bill Act (OBBBA) will roll out. For Tax Year 2025, the forms and federal withholding tables stay the same — while bigger reporting changes arrive for 2026. Plus: a fresh security reminder on IP PINs, Online Accounts, and MFA from IR-2025-83.
TY 2025: What stays the same
The big picture
- No changes to Form W-2, existing Forms 1099, Form 941 and other payroll returns for TY 2025.
- No updates to federal income tax withholding tables for OBBBA provisions in 2025.
- Employers and payroll providers should continue current reporting & withholding procedures for 2025.
Source: IRS News Release IR-2025-82 (Aug. 7, 2025).
What this means for you
- Your 2025 paychecks won’t change solely because of OBBBA; benefits flow at filing time on your 2025 return (filed in 2026).
- If you expect large new OBBBA deductions (e.g., eligible tips or overtime), consider adjusting withholding voluntarily to avoid a big refund or balance due at filing.
Guidance for employers & payroll teams (TY 2025)
Operational checklist
- Keep using 2025 versions of W-2, 1099s, 941 and related payroll forms.
- Retain current federal withholding calculations for 2025 payrolls.
- Monitor IRS updates for OBBBA reporting specs (tips/overtime) coming for TY 2026.
Communication tips
- Tell employees that withholding won’t reflect OBBBA deductions in 2025; they’ll claim them on 2025 returns.
- Share IRS links and timelines so staff understand what changes when.
Looking ahead to TY 2026: changes to reporting for tips & overtime
The IRS is building guidance and updated forms for TY 2026. These will include new reporting rules for tips and overtime pay, with coordination across employers, payroll providers and tax pros to ensure a smooth transition.
OBBBA highlights to watch
- No tax on tips (Sec. 70201): new deduction for qualified tips, with employer/payor information-return requirements; IRS will publish the occupations list by Oct. 2, 2025.
- No tax on overtime (Sec. 70202): new deduction for the overtime portion above regular rate; reporting requirements apply to employers/payors.
See the IRS OBBBA Provisions page for thresholds, caps, and transition relief for TY 2025.
Timeline
- Aug. 2025: IRS confirms no 2025 form/table changes (IR-2025-82).
- By Oct. 2, 2025: IRS to publish list of tip-eligible occupations.
- TY 2026: Updated forms & instructions expected for tips/overtime reporting.
Security update: IP PINs, IRS Online Account & MFA (IR-2025-83)
For taxpayers
- Get a six-digit Identity Protection PIN (IP PIN) to block fraudulent e-filing using your SSN/ITIN.
- Open/secure your IRS Online Account to view balances, payments, transcripts and to approve your preparer’s authorizations.
For tax pros
- MFA is required under the FTC Safeguards Rule — enable it across tax software, portals and cloud storage.
- Use Tax Pro Account to manage POA/TIA requests and client authorizations.
5-minute action checklist
- Employers: Keep 2025 payroll reporting and withholding unchanged; track IRS specs for 2026 implementation.
- Workers: If you expect large OBBBA deductions (tips/overtime), consider adjusting 2025 withholding to match your situation.
- Everyone: Get or renew your IP PIN and lock down your IRS Online Account; turn on alerts and MFA wherever available.
Key dates: IRS Nationwide Tax Forums (security track featured)
| City | Dates (2025) |
|---|---|
| Orlando, FL | Aug 26–28 |
| Baltimore, MD | Sep 9–11 |
| San Diego, CA | Sep 16–18 |
Fast FAQs
Will my 2025 paychecks change because of OBBBA?
No. Withholding tables and core payroll forms stay the same for 2025. You’ll claim eligible OBBBA deductions on your 2025 return filed in 2026.
When do the new reporting rules kick in?
IRS plans updated forms/instructions for TY 2026 covering tips and overtime reporting. Watch fall/winter guidance for details.
How do I protect my tax account today?
Get an IP PIN and secure your IRS Online Account; tax pros must use MFA across all systems.
