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Taxpayers will get bigger standard deductions
NEW YORK | U.S. taxpayers will again see higher standard deductions for 2025, allowing them to shield more of their money from taxation on future returns.
The Internal Revenue Service detailed the increases in its annual inflation adjustments announced Tuesday. For single taxpayers and married individuals filing separately in tax year 2025, the standard deduction is rising to $15,000 — up $400 from 2024.
For couples who file jointly, that standard deduction will be $30,000 for 2025, an $800 jump from the year prior. And heads of households will get a $22,500 standard deduction, up $600 from 2024.
Income thresholds for all seven federal tax bracket levels were also revised upward. The top tax rate, which remains 37%, will cover incomes greater than $626,350 for single taxpayers in tax year 2025, for example — compared to $609,350 in 2024.
The IRS makes such adjustments for each tax year to account for inflation, which has recently been on a downward trend. Last month, inflation in the U.S. dropped to its lowest point in more than three years, marking some encouraging economic news — but Americans are still feeling some key price pressures.
“Core” prices, a gauge of underlying inflation, remained elevated in September, driven up by rising costs for medical care, clothing, auto insurance and airline fares.
While taxpayers will again see higher standard deductions for 2025, the increases announced Tuesday are less than those seen in recent years. In tax adjustments announced last year, for example, the IRS raised single filers’ standard deduction by $750 between the 2023 and 2024 tax years — and by $1,500 and $1,100 for married couples and heads of households, respectively.
Earlier this month, the Social Security Administration announced a 2.5% cost-of-living increase for benefits recipients starting in January. That translates to an average jump of more than $50 on monthly checks for millions of people.
Similar to the latest tax deduction figures, the coming COLA adjustment is lower than that seen in the recent past. Social Security recipients received a 3.2% increase in their benefits in 2024, after a historically large 8.7% benefit increase in 2023, then brought on by record 40-year-high inflation. Next year’s smaller increase reflects moderating inflation.
Flying air taxis move closer to U.S. takeoff with issuing of FAA rule
Federal regulators gave a strong push to electric-powered air taxis Wednesday by issuing a final rule for operating the aircraft and how pilots will be trained to fly them.
The head of the Federal Aviation Administration, Mike Whitaker, said the rule recognizes air taxis as an entirely new type of aircraft that will soon join airplanes and helicopters in the sky.
These aircraft take off and land vertically, like helicopters, but fly like fixed-wing planes. Many companies are working to get them on the market, but they have been held back by the lack of clarity over regulations to govern their use.
Whitaker said the FAA is stressing safety as it works to fold the new aircraft into the nation’s airspace. He said “powered-lift aircraft” are the first new category of aircraft in nearly 80 years, since the dawn of helicopters, and the rule will allow for their widespread operation.
Air taxi supporters call them a cleaner alternative to passenger planes that burn jet fuel. So far, however, current technology limits their size and likely means that they will be used most often in urban areas. Companies envision carrying people and cargo.
One of the companies in the new field, California-based Joby Aviation, praised the FAA regulation. CEO JoeBen Bevirt said the rules “will ensure the U.S. continues to play a global leadership role in the development and adoption of clean flight.”
Airlines see air taxis as a way to deliver passengers to airports. Delta Air Lines said in 2022 it would invest $60 million in Joby, and this month Toyota announced a $500 million investment. United Airlines is backing another California-based company, Archer Aviation, with an order for 200 aircraft that Archer said could be worth $1 billion with an option for $500 million more.
Denny’s says it expects to close 150 locations by the end of 2025
Denny’s says it’s closing 150 of its lowest-performing restaurants in an effort to turn around the brand’s flagging sales.
About half of the closures will happen this year and the rest in 2025, the company said during a meeting with investors Tuesday. The locations weren’t revealed, but the restaurants represent around 10% of Denny’s total.
Stephen Dunn, Denny’s executive vice president and chief global development officer, said in some cases, the restaurants are no longer in good locations.
“Some of these restaurants can be very old,” Dunn said during the investor meeting. “You think of a 70-year-old plus brand. We have a lot of restaurants that have been out there for a very long time.”
Others saw traffic shifts during the pandemic that have yet to reverse, he said.
On Tuesday, Denny’s reported its fifth straight quarter of year-over-year declines in same-store sales, which are sales at locations open at least a year.
Restaurant inflation is outpacing grocery price inflation, which makes it harder for some customers to justify eating out, Denny’s said. And when they do eat out, they often head to fast-casual brands like Chipotle or fast-food chains. Denny’s said family dining — the category in which it competes — has lost the most customer traffic since 2020.
Still, Denny’s said it has bright spots, including a value menu that lifted sales in its most recent quarter and growing sales of its delivery-only brands like Banda Burrito.
Shares in Denny’s Corp., which is based in Spartanburg, South Carolina, tumbled almost 18% on Tuesday.
—From AP reports
