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Last-Minute 2014 Tax Provision Extensions

Posted on: December 12th, 2014
tax extensionA year ago several income tax provisions expired, and just a short time before 2014 is over, the Congress announced proposed extensions of these provisions. Tax plans may need to be updated as taxpayers had not had these provisions available, and they are slated to expire once again at year’s end. The provisions are included in H.R. 5771 Tax Increase Prevention Act of 2014, which was introduced on December 1st, passed the House and is pending sign-off in the Senate as of this writing. (View current status here.) The proposed extensions include:
 
  • Charitable contributions from IRAs. Individual Retirement Account (IRA) owners aged 70 ½ or older would be able to make contributions to public charities from retirement accounts free of tax, up to $100,000. Available to IRA owners whether or not they itemize deductions.
  • Tuition. An extension of above-the-line deduction for qualified tuition and related expenses, which is available to taxpayers based on their filing status. (May not be claimed for married taxpayers filing separately, and may not be claimed if another individual claims the taxpayer as an independent on their tax return). The deduction may be made for tuition paid for oneself, a spouse, or a dependent.
  • Mortgage insurance. Taxpayers would be able to deduct mortgage insurance premiums paid or accrued after December 31, 2013 and before December 31, 2014. Without this provision, the mortgage insurance premium is not treated as qualified resident interest.
More provisions can be reviewed in the Act’s full text.

The provisions above will apply to the 2014 tax year, pending extension sign-off. Stay updated on last-minute tax deductions by following our tax attorneys on Twitter and Facebook. Year-end tax planning might be stressful, especially since tax rules may change unpredictably. Starting a plan early in the year can help make adjustments easier when tax savings opportunities arise. 
 
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