Dr. Friday Radio Show – October 18, 2025

On this beautiful Saturday, Dr. Friday tackles some confusing tax changes and answers crucial listener questions. The show kicks off by clearing up the chaos around the 1099-K reporting thresholds, explaining exactly what the “One Big Beautiful Bill” means for individuals using payment apps like PayPal and Venmo. Dr. Friday also dives deep into a significant new tax deduction for seniors, outlines key tax strategies for year-end, and provides guidance on navigating taxes after major life events like the death of a spouse or a divorce.

Summary

• 1099-K Thresholds Clarified: After some initial confusion, Dr. Friday clarifies the final 1099-K reporting rule under the “One Big Beautiful Bill.” For 2025, the threshold is $20,000 in gross revenue or 200 transactions. Most everyday users of platforms like PayPal and Venmo will not meet this threshold.

• New Tax Deduction for Seniors: A temporary deduction is available from 2025 through 2028 for individuals over 65 receiving Social Security. The deduction is $6,000 per person ($12,000 for a married couple) and is added to your standard or itemized deduction. Income phase-outs begin at $75,000 for single filers and $150,000 for joint filers.

• Tennessee Tax Deadline: A reminder for all Tennessee residents that the deadline to file 2024 taxes and make any associated payments is November 3, 2025.

• Strategic Roth Conversions: Dr. Friday suggests that the new senior deduction may create an opportunity. The resulting tax savings could be used to fund a Roth IRA conversion, potentially allowing you to move money into a tax-free account at a lower cost.

• Filing Status After a Spouse’s Death: For the tax year in which a spouse passes away, the surviving spouse can still file as “Married Filing Jointly.” If a refund is due, Form 1310 will be required to issue the check to the surviving spouse.

• Gifting Rules Explained: The annual gift tax exclusion for 2025 is $19,000 per person ($38,000 for a married couple). For larger gifts, you can utilize the lifetime gift exemption, which is set to be $15 million per person starting in 2026, without incurring gift tax, though a gift tax return must be filed.

Episode FAQ

Q1: I use Venmo to pay my dog sitter and split dinner bills with friends. Will I get a 1099-K and have to report this as income?

A: No, not unless you receive over $20,000 and have more than 200 transactions for goods and services in 2025. After some confusion, the “One Big Beautiful Bill” reverted the threshold to this higher amount, meaning most individuals using payment apps for personal transactions or small side jobs will not receive a 1099-K.

Q2: I’m 68 and on Social Security. Am I getting a $6,000 check from the government with the new senior tax break?

A: It is not a check or a direct payment. It is a new $6,000 deduction that lowers your taxable income. The actual tax savings depends on your tax bracket. For example, if you are in the 10% tax bracket, a $6,000 deduction would save you about $600 in taxes. This deduction also has income limits and begins to phase out for single filers with a modified adjusted gross income over $75,000.

Q3: My husband passed away in April of this year. What is my filing status for my 2025 tax return?

A: For the year in which your husband passed, you are still considered married for tax purposes and should file as “Married Filing Jointly.” This allows you to use the joint tax brackets and standard deduction. In subsequent years, your filing status will change to Single or potentially Qualifying Surviving Spouse if you have a dependent child.

Q4: I want to give my son a large cash gift to buy a house. Do I have to pay taxes on that?

A: The giver of the gift is responsible for any tax, not the recipient. In 2025, you can give up to $19,000 to any individual with