There was good news out of Washington this December when President Obama signed a bill which extended tax savings available to businesses and individuals taxpayers for the 2014 tax season that due were otherwise to expired. These savings may very well offer something for everyone
Here’s exactly how Ashlea Ebeling, author of the article in Forbes.com, described these tax breaks:
- The deduction for state and local sales taxes. The option to deduct state and local sales taxes instead of deducting state and local income taxes is is huge for those who live in no-income tax states like Florida and Texas.
- Above-the-line deduction of up to $4,000 for higher education expenses. This helps college students or their parents.
- A $250 above-the-line deduction for school teachers for supplies.
- Parity for employer-provided mass transit and parking benefits ($250 a month, up from $130 a month). Transit commuters who run all their commuting costs through their employer’s transit plan should get a retroactive true up—a potential $576 extra tax savings for 2014.
- The ability to exclude up to $2 million in discharge of residential mortgage indebtedness from gross income. Normally taxpayers have to pay income taxes on forgiven debt.
- The deduction for mortgage insurance premiums.
- Energy-efficient home improvements tax credit. This one is listed under “energy” extenders but it affects homeowner’s personal tax return. You can get a tax credit (that’s a dollar for dollar reduction in your tax liability) of up to $500 for making energy-efficient home improvement like new windows or upgraded heating/a-c equipment.
- Tax-free distributions from an Individual Retirement Account for charitable purposes (the IRA charitable tax rollover) for taxpayers over 70 ½.
- Enhancements to the rules for donating real property for conservation that encourage farmers, ranchers and other modest-income landowners to increase the pace of land conservation.
You can learn more about this topic as well as other strategies on our website under the tab entitled: estate planning in Virginia. Be sure you also sign up for our complimentary e-newsletter so that you may be informed of all the latest issues that could affect you, your loved ones and your estate planning.
REF:Forbes.com (December 19, 2014)“Obama Signs 2014 Tax Extenders: Money In Your Pocket “ https://www.forbes.com/sites/ashleaebeling/2014/12/19/obama-signs-2014-tax-extenders-money-in-your-pocket/