Will the habit of late law changes continue?
|The Congressional habit for repeatedly making late tax law changes is now so bad that the IRS is reserving blank lines on the form 1040 for possible law changes this month. Given the potential for retroactive tax law changes in 2015, please prepare for the extension of the following tax laws that expired in 2014. While there is no guarantee that tax law extensions will be made, by being prepared with the proper documentation you can take advantage of any forecasted changes.|
|Educator’s $250 tax deduction
If you are a teacher and have out-of-pocket expenses please keep your receipts. You may be able to deduct up to $250 of qualified expenses even if you do not itemize deductions.
|State sales tax itemized deduction option
Keep receipts of any large purchases. The sales tax provision allows for you to take either a general sales tax deduction or a state income tax deduction as an itemized deduction.
|Direct contribution from retirement accounts for qualified seniors
In 2014, qualified seniors who donated funds directly from their retirement plan could exclude the plan withdrawal from income. Hold off using this technique in 2015 until you receive confirmation from Congress this tax law is extended.
|Itemized deduction for mortgage insurance premium costs
Keep your mortgage insurance documentation for a potential itemized deduction.
|Changes in small business depreciation
Through late November, 2015 there is no longer bonus first year depreciation. In addition, Section 179 amounts are greatly reduced from $500,000 in qualified assets to $25,000. Even if the law changes, you have little time to purchase and install equipment. Please plan accordingly.
|If other late law changes impact you, rest assured those changes will be applied to your tax return as they become known.|