On December 19, 2014, President Obama signed into law the Tax Increase Prevention Act of 2014 (“The Act”). The Act retroactively extends, through 2014, individual, business, and energy tax relief provisions that expired at the end of 2013.
Highlights of The Act you might want to take advantage of before 2014 comes to a close include the following:
Individual tax extenders.
The Act extends the following individual tax benefits:
- Provision allowing tax-free direct contributions of up to $100,000 from IRA accounts to public charities by individuals 70½ or older;
- Above-the-line deduction of up to $250 for certain expenses of elementary and secondary school teachers;
- Above-the-line deduction for qualified tuition and related expenses;
- Exclusion from gross income for discharge of indebtedness on qualified principal residences;
- Itemized deduction for mortgage insurance premiums as qualified residence interest;
- Itemized deduction for State and Local general sales taxes in lieu of State and Local income taxes;
- Parity for exclusion from income for employer-provided mass transit and parking benefits; and
- Special rules for contributions of capital gain real property made for conservation purposes.
Business tax extenders.
The Act extends the following business tax provisions:
- Section 1202 exclusion of gain on sale of certain small business stock at 100%;
- Research tax credit;
- Work opportunity credit;
- Section 179 asset expensing at $500,000;
- 50% bonus depreciation; and
- Extension of 15-year straight-line cost recovery for qualified leasehold improvements.
Energy-related tax breaks extended.
The Act extends certain energy tax incentives including:
- Tax credit for residential energy efficiency improvements;
- Tax credit for energy-efficient new homes; and
- Tax deduction for energy-efficient commercial buildings.
To learn if you qualify for these tax extenders, please contact your Untracht Early advisor for more information.