Which of the 2025 Tax Law's New Deductions Can You Combine?
Four separate provisions, four separate tests — qualifying for one says nothing about the others, and nothing stops you claiming all four.
Updated 18 Sept 2026
The 2025 tax law's four new below-the-line deductions — overtime (§225), tips (§224), car loan interest (§163(h)(4)), and the senior bonus (§151(d)(5)) — are entirely independent. A taxpayer can qualify for any combination of them in the same year, each tested and phased out on its own against the same MAGI, with no shared cap or interaction between them.
What does this mean for you? Work out your own number: 2025 tax law savings calculator
Four different provisions of the 2025 tax law each added their own temporary, MAGI-phased deduction for 2025 through 2028. None of them were written to exclude the others, and a taxpayer who happens to qualify for more than one gets to claim all of them.
The four, side by side
| Deduction | Code section | Cap | Filing-status bar |
|---|---|---|---|
| No tax on overtime | §225 | $12,500 single / $25,000 joint | Married filing separately: barred |
| No tax on tips | §224 | $25,000 flat | Married filing separately: barred |
| Car loan interest | §163(h)(4) | $10,000 flat | None — separate filers just use the lower threshold |
| Senior bonus (65+) | §151(d)(5) | $6,000 per person | Married filing separately: barred |
Nothing links them together
Three things are true of all four at once, and none of them create an interaction:
- Each has its own MAGI phase-out, using the taxpayer’s overall MAGI — not a MAGI that’s been reduced by any of the other three deductions.
- No shared or combined cap. Claiming the full $25,000 tips deduction doesn’t use up any part of the separate $12,500/$25,000 overtime cap, or vice versa.
- Each has its own eligibility test, checked independently: an occupation on Treasury’s tip list, FLSA-qualifying overtime, a vehicle meeting all six requirements, or turning 65 by year-end. Meeting one test says nothing about whether you meet another.
Filing status matters differently to each one
Three of the four — overtime, tips, and the senior bonus — bar married filing separately outright, at any income. The car loan interest deduction is the one exception: a separate filer can still claim it, they just use the same $100,000 threshold as a single filer rather than $200,000.
A realistic combined example
A married couple filing jointly, one spouse a server with qualifying tips, the other working qualifying overtime, who financed a new US-assembled car after 2024 and where one spouse turned 65 this year, could in principle claim all four in the same return — four separate deductions from four separate provisions, each computed on its own terms.
See the total for your own situation with the 2025 tax law savings calculator, which runs all four calculations together against one MAGI and adds up the result.