Category: Blog

Completing FY2026 Budget Appropriations, Protecting Trafficked Victims, and Vetoing Special Interest Projects

3 min read

HR 6938Commerce, Justice, Science; Energy and Water Development; and Interior and Environment Appropriations Act, 2026 (HR 6938) – This Act is one of the remaining budget bills to fund the government through Sept. 30, 2026. It includes funding for several agencies, including the Department of Commerce, the Department of Justice, the U.S. Army Corps of Engineers, the Department of Energy, and the Environmental Protection Agency. The bill was introduced by Rep. Tom Cole (R-OK) on Jan. 6. It passed in the House on Jan. 8, the Senate on Jan. 15, and was signed into law on Jan. 23.

Financial Services and General Government and National Security, Department of State, and Related Programs Appropriations Act, 2026 (HR 7006) – This Act was introduced by Rep. Tom Cole (R-OK) on Jan. 12. Yet another fiscal year 2026 budget bill, it authorizes investments to support economic growth and entrepreneurship, safeguard American security and authorize funding for the Executive and Judicial branches. The bill passed in the House on Jan. 14 and is awaiting passage in the Senate.

Trafficking Survivors Relief Act (HR 4323) – The purpose of this bipartisan bill is to help stop a vicious cycle that makes human trafficking victims vulnerable to further exploitation. The Act enables survivors to file motions to vacate non-violent convictions and purge arrest records for certain criminal offenses committed as a direct result of being trafficked. The current iteration of the bill was introduced by Rep. Russell Fry (R-SC) on July 19, 2025. It cleared the House on Dec. 1, the Senate on Dec. 18, and was signed into law on Jan. 23.

Finish the Arkansas Valley Conduit Act (HR 131) – Introduced by Rep. Lauren Boebert (R-CO) on January 3, 2025, this bill is related to a Colorado water infrastructure pipeline currently under construction, designed to port clean water from the Pueblo Reservoir to 50,000 Coloradans in the local area. The bill would have extended the repayment period for local municipalities and removed interest payments. The bill passed in the House on July 21 and in the Senate on Dec. 16; it was vetoed by the President on Dec. 31, 2025.

Miccosukee Reserved Area Amendments Act (HR 504) – This bill would have authorized the expansion of the Miccosukee Reserved Area to include a portion of Everglades National Park in Florida. In recent years, the area, known as Osceola Camp, has been prone to flooding, and this bill would have authorized safeguard measures to protect structures within the camp. The bill was introduced on Jan. 16, 2025, by Rep. Carlos Gimenez (R-FL). It passed in the House on July 14 and in the Senate on Dec. 11, 2025. The bill was vetoed by the President on Dec. 30 and failed an override vote in the House on Jan. 8.

Whole Milk for Healthy Kids Act of 2025 (S 222) – This Act amends the existing National School Lunch Act to allow schools participating in the federal school lunch program to serve whole milk. It was introduced by Sen. Roger Marshall (R-KS) on Jan. 23, 2025, passed the Senate on Nov. 20, the House on Dec. 15 and was signed into law by the President on Jan. 14.

Reclaiming the Rent: Why 2026 is the Year Businesses Switch from SaaS to Sovereign Ownership

4 min read

Businesses Switch from SaaS to Sovereign OwnershipEvery modern business is paying rent. Not for office space or equipment, but for the digital infrastructure that runs the company. This might include the cost of CRMs, email platforms, project management tools, automation tools, analytical dashboards, and countless other tools designed to solve a specific business need. Individually, these tools seem affordable; collectively, they form a permanent tax on business growth.

For several years now, software-as-a-service (SaaS) has been sold as a form of freedom. Businesses were promised low upfront cost, instant deployment, and minimal complexity. For a long time, SaaS delivered on this promise. It helped companies move faster, scale quickl,y and compete globally regardless of size.

But this is shifting. Now, business leaders are beginning to question whether renting critical systems is still a worthy strategy.

The SaaS Era

The rise of SaaS was a necessary evolution. It lowered the entry barrier for tools that once required large IT teams and a huge capital investment.

However, this convenience turned into dependency. Businesses not only adapted SaaS tools, but they also built operations around them. Third-party platforms now hold business workflows, customer data, analytics, automations, and even institutional knowledge. This means that a business has dozens of subscriptions they don’t fully control, can’t meaningfully customize, and must keep paying for to keep operating.

What Sovereign Ownership Means

Sovereign ownership doesn’t mean abandoning the cloud or rejecting modern technology; it means owning the core logic of your business systems. The sovereign models emphasize self-management, control and long-term resilience.

When a business practices sovereign ownership, it controls:

  • Where data resides (e.g., virtual private clouds or sovereign clouds)
  • Access permissions and encryption keys
  • Workflows and automations
  • Internal knowledge systems
  • AI models and training data
  • The ability to move, adapt, or rebuild without needing vendor permission

Self-sovereign identity has been a great support for this shift. SSI protocols allow businesses, employees, and customers to control their digital identities and credentials without relying on centralized identity providers. This means that identity is not locked inside the SaaS platform, as it is portable, verifiable, and owned by the entity itself.

The Real Cost of SaaS Goes Beyond the Invoice

SaaS costs more than renting the service. Aside from monthly or annual subscriptions that compound into a huge expense over time, vendor lock-in makes switching platforms painful and risky. The pricing models also keep changing. Features may be removed or placed under higher payment tiers. Other issues include broken integrations and limited or messy data exports.

More critically, companies adapt their workflows to match the SaaS tools, rather than the tool serving the business. Therefore, innovation is constrained by what the platform allows and not what the business needs.

The biggest risk is when a SaaS provider is acquired, suffers downtime, or shuts down entirely. When this happens, your business absorbs the impact without control or leverage.

Why 2026 Is the Turning Point

Why now? Because the alternatives have finally matured. Decentralized physical infrastructure (DePIN), the maturity of enterprise-grade, open-source software, and modular cloud architecture have made system ownership accessible without deep technical teams. AI has transformed how businesses build, automate, and maintain internal tools. Modular infrastructure allows companies to own their core while selectively renting specialized services.

At the same time, external pressure is increasing as data privacy regulations tighten. Regulatory frameworks like the U.S. Cloud Act, the GDRP and the EU’s Digital Operational Resilience Act (DORA) demand operational independence that SaaS cannot fully deliver. Gartner predicts that by 2030, 75 percent of enterprises outside of the United States will implement data sovereignty strategies due to regulatory scrutiny and geopolitical tensions.

Major players are already responding. IBM is one example of the shift, as they already announced IBM Sovereign Core, software that helps businesses take back control of their data and systems.

Customers are also more aware. They want to know how their data is stored, processed, and protected. AI models trained on proprietary information raise new questions of ownership and risk. In an uncertain global economy, businesses want cost predictability and not endless variable subscriptions.

The mindset is shifting from speed at any cost to resilience by design.

From Renters to Owners

SaaS helped businesses grow. But growth built on dependency has limits.

2026 represents a strategic window where ownership is finally accessible, affordable, and necessary. The shift toward sovereign systems is not about rebellion against technology that has previously helped businesses. It’s about leverage, resilience, and long-term value.

The future belongs to businesses that stop renting their foundations and start owning their future.

Passive Income 101

3 min read

What is Passive Income 101If you’re tired of the 9-to-5 grind, then passive income could be for you. While not a get-rich-quick scheme, it’s a way to build systems that contribute to financial stability and extra money. It can even support long-term goals like early retirement. Here’s a high-level look at what it is and how it works.

Types of Passive Income Sources

  1. Investment Income
    This includes individual stocks or mutual funds, interest payments from corporate bonds, or capital gains from selling securities at a profit. While they all involve risk, these types of investments can compound and grow over time.
  2. Rental Income
    Depending on where your property is, this could be a cash cow. The money you earn can cover the mortgage, taxes, maintenance, and other miscellaneous expenses. The best part? You could earn a sweet sum of money.
  3. REITs and Crowdfunded Real Estate
    REITs (real estate investment trusts) and crowdfunded real estate platforms allow you to invest in properties without having to buy them yourself. You earn net rental income in the form of dividends without the headache of managing the property. Not bad, right?
  4. Business Income
    You earn this money by not actually participating in the operations. For example, you might invest in a restaurant. Others run the daily business while you receive a percentage of the profits. Sweet.
  5. Intellectual Property Royalties
    Pen a book. Write a song. Create an online course. You’ll reap the rewards long after the work is completed.
  6. High-Yield Savings Accounts
    Yes, this might yield small returns, but it’s a great way to put your money to work.

What are the benefits? There are many.

  • Wealth Building
    When you reinvest your dividends, save and invest your rental profits and royalties, you’ll steadily create a nest egg that will compound and grow, grow, grow.
  • Financial Freedom
    While this type of capital building takes time, it can supplement, if not replace, your day job.
  • Time Flexibility
    You don’t have to work on this revenue stream every day, which is the beauty of it. It clears up time for you to live your life.
  • Diversification
    When you have more than one income source, it can act as somewhat of a safety net, should your main way of earning a living dry up.

Risks and Taxes

While passive income can and does build wealth, it’s not without risks. Markets may fluctuate. Property values might decrease. Companies that are part of third-party crowdfunding could shut down. You’ll also have to pay taxes, as you must report your earnings. Selling stocks or properties can trigger capital gains.

Passive income has pros and cons. Only you can decide how risk-averse or tolerant you are. If this type of investing is for you, the sooner you start, the sooner you’ll create financial security – and freedom.

Sources

https://www.crediful.com/what-is-passive-income/

 

Defining An Activity Cost Driver

3 min read

Defining An Activity Cost Driver, What is An Activity Cost DriverAn activity cost driver is anything that causes a company’s variable costs to either reduce or grow. Since measuring an activity cost driver is a way to streamline the administration of managing production costs, it’s an integral part of activity-based costing.

Examples of activity-cost drivers are warehouse expenses, modifying engineering designs, and retooling, setup, and maintenance costs for machining needs. This can include higher warehouse expenses due to increased rents or leases, which add to the final amount of the product or service’s sales price. Machining costs include initial setups for initial production and ongoing maintenance costs for continued runs. If production needs to be re-engineered to different production parameters, those professional revision costs need to be added to the ultimate product or service cost calculations.

These cost drivers are used as a starting point to project the business’ operational and profitability goals through the use of activity-based costing (ABC), a type of managerial accounting.

ABC accounting is a way to determine the expenses of each output by looking at the inputs used during the company’s operations, be it power for the machinery, Information Technology (IT) needs, or labor.

It’s important to know that one variable expense can impact multiple single activity cost drivers. For example, wage costs and machining expenses can be identified as activity cost drivers in connection with production. The first step is looking at how ABC accounting can determine indirect costs.

Activity-Based Costing Illustration

A business wants to look at how its production space and its lease or real estate and property tax costs are attributable to individual widgets or services, based on the percentage dedicated to the respective product or service. If it’s not allocated properly, determining sales prices and profitability can be negatively impacted.

If a company has two product lines with the same retail prices and production quotas, with direct costs of $700 and $250, it’s important to see how the production area for each product impacts the company’s overall operations. If the first item uses 40 percent of the production area and the second item uses 60 percent of the production area, and the rent is $1,500, the rent needs to be factored in. The first item would see an additional cost of $600 plus the original $700, or a total of $1,300. The second item’s cost would be $900 for the rent and $250 for the item, or a total of $1,150. While the initial direct cost for the first item seems higher than the second item, when factoring in all costs, this time it’s still true – but that’s not always the case.

Once this has been established, and then a company receives a new order, the following illustrates how measuring an activity cost driver, such as performing maintenance on machines after a production run, will cost the company to have it ready for their next order. If it costs a company $200 for machine maintenance and it produces 1,000 widgets, a $0.20/widget cost would be factored into margins and retail pricing.

While this provides an overview of how activity cost drivers work, it is part of a comprehensive approach to how businesses measure their margins and ultimately profitability. 

Accounting for Net Charge Offs

3 min read

Accounting for Net Charge OffsWhen it comes it understanding a net charge-off (NCO), it’s the difference between any recovery of delinquent debt and gross charge-offs a business sees in a defined accounting time frame. NCOs are debts a company projects with a low likelihood of being collected. It can happen when a customer stops paying outstanding invoices or sees a decline in their credit rating.  

The first step considers it as a gross charge-off; if any amount is recovered, it’s subtracted to arrive at net charge-offs. If businesses can recover a percentage of what’s been charged off, the recovered monies can be net against the gross charge-offs to realize net charge-offs. A business’ loan loss provision is lowered by the net charge-off amount at the end of the accounting time frame and then refilled for the next accounting time frame based on new estimates for loan losses. This is part of a business’ provision for credit losses (PCL) that projects a certain percentage of accounts unable to be collected.

Accounting in Detail

The following formula calculates net charge-offs (NCO). This assumes a gross charge-off booking of 6 percent of all outstanding loans, with 1 percent ultimately being recovered during a particular accounting time frame.

Net Charge-Offs = Gross Charge-Offs – Amount of Recovered Debt

= 6 percent – 1 percent = 5 percent

Once the figure is calculated, the 1 percent collected adjusts the loan loss provision in the accounting statements.

Financial Institutions Illustrate Accounting Considerations

Banks’ business models and financials demonstrate their ability to pay their depositors competitive interest rates while also being able to make loans. Since banks earn profits via net interest margin, earning a spread between what banks pay depositors on interest rates and what borrowers are charged on loans, the spread is integral to measuring profitability. To generate the total value of a bank’s balance sheet, it’s imperative for banks to estimate and project their charge-offs as accurately as possible.

Financial institutions determine credit loss provisions by analyzing their balance sheets and the level of risk represented by outstanding loans. They look at the ratio of loan losses to overall losses, which is their net charge-off rate. The net charge-off rate is used to evaluate a loan’s book quality against other banks.

How Different Risks Impact Net Charge-Off Levels

Banks that have different loan mixes will see different risk and reward payoffs. If one bank offers primarily secured loans, while it may have lower net interest margins, it will also have lower charge-offs because the collateral backing them is less risky overall. This is compared to other lenders that have a higher level of unsecured loans, such as credit cards and commercial loans. This scenario, in the case of riskier loans, may result in higher net interest margins, but also greater potential for higher losses.

Journal Entry Examples

The following journal entries illustrate how to account for bad debts. Using the direct write-off method, when debt collection efforts have been exhausted, bad debts are recorded as follows:

Expenses for bad debt: Debit $750

Accounts Receivable: Credit $750

If, however, the business recovers anything from the customer’s outstanding invoices, the following journal entries would be added if $200 were received:

Cash: Debit $200

Accounts Receivable: Credit $200

Conclusion

While this is primarily for early-stage companies with a low percentage of credit sales, it illustrates how businesses can update their books when projecting their numbers to account for net charge-offs.

What Families Need to Know About the New Trump Accounts

4 min read

What are Trump Accounts?American parents now have access to a completely new savings tool designed to give children a financial foundation for the future. Established through The One Big Beautiful Bill Act, these accounts carry the name of the current president and come with a unique set of rules that the IRS has just begun to clarify.

Who Can Open One?

Any minor holding a Social Security number who has not yet turned 18 by Dec. 31 of the current year meets the eligibility criteria. Getting started requires an authorized adult, typically a parent or legal guardian, to submit an application to the Treasury Department. Once processed, the government establishes the child’s account.

Free Money for Newborns

Families welcoming babies during a specific four-year window stand to benefit the most. American citizens born anytime from the start of 2025 through the end of 2028 qualify for a $1,000 federal deposit through a pilot initiative. This starter contribution sits outside all annual limits, meaning it will not reduce how much others can add later.

Billionaire Backing Adds More

Tech titan Michael Dell and his wife, Susan, have pledged $6.25 billion to boost these accounts further. Their generosity will provide an extra $250 to the first 25 million children meeting specific requirements. Kids must be no older than 10 and reside in areas where the median household income is under $150,000. Dell, who runs Dell Technologies as chairman and CEO, ranks 10th among America’s wealthiest individuals with a fortune estimated at $148.9 billion.

How Much Can Be Contributed Each Year?

The law caps annual contributions at $5,000, though this figure will rise with inflation over time. Grandparents, aunts, uncles, family friends, and parents can all put money in, but every dollar from these sources counts toward that yearly ceiling. Exceed the limit, and you will need to pull the excess back out.

Workplace benefits offer another channel. Companies can deposit as much as $2,500 annually into accounts belonging to workers or their children. While this money does apply toward the $5,000 threshold, employees will not owe taxes on these contributions.

Charitable organizations and government bodies at various levels have permission to fund these accounts through something called qualified general contributions. Unlike personal or employer deposits, this category of funding exists completely outside the annual cap.

Keep in mind that money coming from family members or friends provides no tax break. These contributions use after-tax dollars. Also worth noting: the earliest anyone can start funding these accounts is Independence Day 2026.

Strict Rules Govern Investments

Congress placed tight restrictions on where this money can go. Only mutual funds and ETFs tracking American stock market indexes qualify. These funds cannot employ any leverage strategies, and their annual expense ratios must not exceed one-tenth of one percent.

Accessing the Funds

Until reaching adulthood, account holders face severe limits on touching their money. The rules permit withdrawals only in narrow circumstances: transferring everything to a different Trump Account, correcting over-contributions, or closing the account following the child’s death.

Everything changes at 18. From that birthday forward, the account essentially transforms into something resembling a traditional IRA with comparable guidelines around distributions and taxation.

Filing Requirements

Establishing one of these accounts means completing Form 4547, which the IRS titled Trump Account Election. This document accompanies your annual 1040 filing and handles both account setup and pilot program enrollment. The form number itself contains a nod to history, combining 45 and 47 to reflect Trump’s elections as both the 45th and 47th commander in chief.

Conclusion and Official Resources

This new savings tool gives families an innovative avenue to save. Taxpayers seeking detailed information can review Notice 2025-68, which the IRS published to address questions about account creation, investment options, contribution types, distribution rules, and reporting obligations. Full regulations remain in development, with proposed rules expected before final versions emerge following public input. The government maintains a dedicated portal at trumpaccounts.gov for ongoing updates.

Improving Military Benefits, Relaxing Energy Regulations and Increasing Aviation Regulations

3 min read

Improving Military BenefitsVeterans’ Compensation Cost-of-Living Adjustment Act of 2025 (S 2392) – This Act was introduced by Sen. Jerry Moran (R-KS) on July 23. It passed in the Senate on Nov. 9, the House on Nov. 17, and was signed into law on Nov. 25. The purpose of this bill is to increase rates of compensation for veterans with service-connected disabilities, as well as the rates of dependency and indemnity compensation for the survivors of certain disabled veterans. The rate hikes became effective on Dec. 1.

Fairness for Servicemembers and their Families Act of 2025 (HR 970) – This bipartisan Act was introduced on Feb. 4 by Rep. Marilyn Strickland (D-WA). It authorizes increases to servicemember and veteran life insurance packages in order to account for inflation and higher costs of living. It passed in the House on April 7, in the Senate on Nov. 20, and was enacted by the President on Dec. 12.

Veteran Fraud Reimbursement Act of 2025 (HR 1912) – The Veterans Benefits Administration has experienced negligence and fraud that have prevented many veterans from receiving benefits. In the past, the case-by-case system of investigation into misuse led to further delays; in some cases, veterans passed away before ever receiving remuneration. The purpose of this bill is to allow the Veterans Benefits Administration to reimburse victims of fraud via a streamlined process, so that the investigation occurs after the affected veterans have been reimbursed. The bill, which was introduced by Rep. Gerald Connolly (D-VA) on March 6, passed in the House on May 5, in the Senate on Nov. 20, and was signed into law on Dec. 12.

SPEED Act (HR 4776) – The purpose of this bipartisan legislation is to streamline the existing environmental analysis requirements for energy projects (e.g., offshore drilling, mining, pipeline development). Provisions include reducing litigation challenges to a 150-day challenge window, developing standardized federal action criteria, and defining procedural deadlines. The Act was introduced by Rep. Bruce Westerman (R-AR) on July 25 and passed in the House on Dec. 18. Its fate currently rests with the Senate.

ROTOR Act (S 2503) – Prompted by multiple incidents this year, including military aircraft such as the Washington, D.C., helicopter collision, this bipartisan bill seeks to improve aviation safety and Federal Aviation Administration (FAA) oversight. The legislation would specifically require all aircraft to incorporate ADS-B technology, which displays nearby planes and weather data on cockpit screens. The legislation was introduced by Sen. Ted Cruz (R-TX) on July 29. It passed in the Senate on Dec. 17 and awaits consideration by the House.

Lower Health Care Premiums for All Americans Act (HR 6703) – Sponsored by Rep. Mariannette Miller-Meeks (R-IA), this healthcare bill proposes expanding association health plans, increasing transparency requirements for pharmacy benefit managers, and funding some cost-sharing reductions for qualifying Health Insurance Marketplace enrollees. It does not include extending the enhanced premium tax credits that expired on Dec. 31, 2025. The bill was introduced on Dec. 15 and passed in the House on Dec. 17. Its fate now lies with the Senate.

What Frictionless WebAR Means for Creators, Brands and Small Businesses

4 min read

What Frictionless WebAR MeansThe way people interact with the web is changing fast. Attention spans are shorter, app fatigue is real, and users no longer want to download, sign up, or navigate complex interfaces just to engage with content. New technologies like frictionless web-based augmented reality (WebAR) are emerging as powerful solutions.

This shift opens great opportunities for creators, brands, and small businesses.

What is Frictionless WebAR?

Every extra step between a user and an experience reduces engagement. Downloading apps, dealing with permissions, updates, and onboarding screens all create friction. However, frictionless WebAR is delivered directly through a web browser. It uses web standards like WebXR and WebGL to deliver digital content without downloads or installations. With a shift in how value is created, communicated, and converted, it is possible to have interactive storytelling, experiential funnels, immersive education, and hyper-local marketing. All this is without the costs and complexity involved in traditional AR.

Transitioning from the attention economy to the experience economy has been driven by content overload from content, ads, and interfaces competing for clicks. As a result:

  • Users avoid downloading new apps
  • Click-through rates are declining
  • Trust is harder to build through a flat screen alone
  • Static content struggles to hold attention

Frictionless WebAR addresses these barriers.

Users can easily scan a QR code or tap a link and instantly see a product, explore a story in 3D form, or interact with information visually.

From a business perspective, the value lies in zero-friction entry, instant immersion, and seamless connection between physical and digital worlds. This is because WebAR does not require large development teams or app store approvals. It is lightweight, fast, and accessible. This makes it viable not only for big brands but also for solo creators and small businesses.

From Passive Content to Active Experiences

With most digital content, users scroll, read, watch, and move on. Frictionless WebAR is built to turn audiences into participants. Instead of reading about a product, users can see it in a 3D model. Instead of watching a story, they can step inside it. When audiences interact with something in their own environment:

  • Engagement time increases
  • Emotional connections deepen
  • Information is remembered longer
  • Purchase confidence improves

Practical Opportunities for Creators

For filmmakers, artists, game developers, and content creators, frictionless WebAR transforms static content into dynamic, interactive narratives. For instance, scanning a QR code in a physical comic book brings a character to life. This deepens immersion and extends the narrative beyond the printed book. Other examples include AR-enhanced portfolios that showcase work in 3D, behind-the-scenes experiences tied to a QR code, and interactive course previews.

Creators can also monetize WebAR by offering premium AR experiences, bundling AR with digital products, launching interactive experiences for sponsors, and enhancing membership or community access. This makes WebAR part of a creator’s intellectual property and not just a marketing tool.

Practical Opportunities for Brands

Brands leverage WebAR for immersive marketing. Experiential funnels leverage WebAR, allowing brands to engage customers in ways traditional advertising cannot. A good example is a brand launching a new shoe, and customers can scan a QR code on a poster and “try on” the virtual sneakers to see how they look in real time. Luxury brands can offer “virtual showroom” experiences with interactions that deepen the emotional connection.

The low-barrier interaction means higher engagement rates as potential customers are more likely to participate in an experience that doesn’t demand an app download or login.

Practical Opportunities for Small Businesses

Small businesses often struggle to compete with larger brands online. However, now they can access cost-effective WebAR without native app development. This equalizer offers sophisticated marketing and customer engagement tools without the need for a massive budget or IT team. This saves on resources and enables quick campaigns like seasonal promotions.

Since WebAR works through web browsers, a business can gain detailed analytics, such as user behavior. For instance, getting detailed data on dwell time or how long people engage in the experience can indicate how compelling the content is. Spatial analytics, on the other hand, measure how much time users spend on specific scenes, helping make necessary tweaks to optimize user experience. The data collected helps better understand customers and how they engage with content.

Conclusion

Frictionless WebAR represents a fundamental change in how value is delivered online. For creators, brands, and small businesses, it offers a way to stand out by inviting people into meaningful experiences.

In a crowded digital space, ease of access is a competitive advantage. 

5 Rules for Giving to Charity

3 min read

Giving to CharityGiving to charity is good for a couple of reasons. First, giving to organizations you believe in is intrinsically good – for them and for you. When we give, the “love hormone” oxytocin is released. Second, giving can reduce your taxable income, which also might make you feel pretty good. But here are a few things to know before you start doling out your cash.

Make sure you give to an IRS-recognized charity. More specifically, it must be a tax-exempt organization that is defined by section 501(c)(3) of the Internal Revenue Code, which includes entities like religious organizations, the Red Cross, nonprofit educational agencies, museums, volunteer fire companies, and organizations that maintain public parks. Most importantly, you must not have received anything in return for your gift. So before you give, make sure you verify your organization with this handy IRS tool. It’s super important to do this before you donate, and be sure to ask how much of your contribution will be tax-deductible. This is key.

Gifts to family and friends don’t count. As much as you’d like to gift perhaps a worthy nephew, these amounts are not tax-deductible. In fact, if they exceed a certain amount, they could be subject to a gift tax.

Deductions have a cap. Generally, you can deduct up to 60 percent of your adjusted gross income via charitable donations (for cash donations). That said, you may be limited to 20 percent, 30 percent or 50 percent, depending on the type of contribution and the organization. Examples of limited contributions include non-cash gifts, private-foundation gifts, etc. This deduction limit applies to all the donations you make during the year, no matter how many organizations you give to.

Exceeding your limit. If you go over the 60 percent limit of your adjusted gross income, the amount can be deducted from your tax returns over the next five years, or when the money’s gone. This process is known as a carryover. Good news for those who are generous.

Deductions for non-itemizers & itemizers. Specifically, for the 2025 tax year (taxes that are due by April 15, 2026), you’ll have to pivot and itemize to deduct your charitable contributions and get the tax break.

But for the 2026 tax year (taxes due April 15, 2027), the rules change for both types:

  • If you don’t itemize on your tax return, you can deduct up to $1,000 (single) or $2,000 (married filing jointly) in charitable contributions. This means you can take an above-the-line deduction for the 2026 tax year on the tax return that you’ll file in 2027.
  • If you do itemize on your tax return, you must donate an aggregate total of at least 0.5 percent of your adjusted gross income to charity to claim the deduction. Only the portion of your total charitable donations that exceeds 0.5 percent is deductible.

Making sure you follow these guidelines will ensure that you can realize your well-deserved deductions and tax breaks. If you have other questions about charitable giving, consult your tax professional. They’ll know all the ins and outs of charitable giving and keep you secure moving forward.

Sources

Tax-Deductible Donations: 2025-2026 Rules for Giving to Charity – NerdWallet

How to Account for Accretion

3 min read

What is Accretion?Whether it’s an individual investor or a business owner looking to increase their earning power, understanding how accretion works is essential for individual and business investors to make the correct decisions going forward.

How Accretion Works for Bonds

Accretion is the gradual increase of a bond’s value over time. As a bond moves toward its maturity date, it increases in value until it reaches its face or par value – or what’s paid to the bondholder upon maturity.

If a bond has a face value of $2,000, yet it’s discounted at $1,900 when it’s offered for sale, the present value of the bond is $1,900, leaving the difference of $100 as the discount. Between the time of purchase and when it matures, the value of the bond will appreciate, up to its par value of $2,000. As the bond increases in value, this is referred to as an accretion discount. 

When it comes to accounting for bond accretion, there are two common methods.

Straight-Line Method

This approach documents the bond’s appreciated monetary gain and is laid out equally over the bond’s time frame until maturity. For a bond with a term of 10 years and a business that publishes its earnings once a quarter, there are 40 earnings releases.

If there’s a $100 discount, spread across 40 quarters, that is $2.50 every three months. The $2.50 is the quarterly accretion until the bond matures.

Constant Yield Method

This method is different from the straight-line method in that the bond’s value appreciation increases in value closer to the bond’s maturity date.

Acquisitions and Accretion

Companies can also benefit from accretion. Through the concept of synergy, where there’s more output from combining multiple entities than the sum of them if still separate, an acquiring company adds the earnings before interest, taxes, depreciation, and amortization (EBITDA), for example, to add to its existing shareholders’ value.

Illustrating How it Works

If Company X wants to increase its earnings per share for its shareholders, an acquisition is one way to do so. Assume Company X earned $1 million in net income the preceding year and has 3 million shares. And then there is Company Z, which had $500,000 in net income over the same time frame, with 1 million shares issued to raise cash. The following is a way to calculate the acquisition accretion value of the new combined company.

Earnings Per Share of Company X: 1,000,000 / 3,000,000 = 0.33

Earnings Per Share of the new company post-acquisition: ($1,000,000 + $500,000) / (3,000,000 + 1,000,000) = $1,500,000 / 4,000,000 = 0.375

Based on the calculation, the earnings per share of the post-acquisition company are $0.375. Compared to the EPS for the original, pre-acquisition Company X, the post-acquisition company is $0.045, resulting in a positive acquisition accretion.

Whether an individual investor is looking to see how bond accretion works or a company is looking at whether an acquisition makes business sense, understanding how accretion works is essential to ensure it’s accounted for properly.