Tax Power U.S. Tax & Business Advisory Services and Solutions

Home / Up / Our Team / Tax Terms / Search Page / Tax History / Why Pay Tax / Tax Problems / Contact Us / Fees & Policies / Fee Payments     

 

Andy Powers-A Professional who cares..About YOU!

Home
Up
Expatriate Tax Questions
U.S. Expatriates
Foreign Nationals
Relocation
How The ACA Affects Your Taxes
Why Choose Powers
Standard Approach
Individual Taxes
Business Tax
Employment Issues
Small Business
IFRS
Public Realtions & Marketing
Business Management
U.S. Constitution
Clients
US Economic Survival
Due Diligence
IRS Denying FEIE to U.S. expats
Foreign National US Tax Guide
FATCA
2012 OVDI
Refund Delays
FUI
Tax Court Limits IRA Rolloves
           

 

 

 

 

Several Tax Breaks Have Expired (AGAIN) in 2013-

                                May be Reinstated by Congress Retroactively

 

Unless Congress, in early 2014, votes to extend selective tax incentives retroactively as they have done in the past, 55 tax breaks Several Tax Breaks Have Expired (AGAIN) in 2013-May be Reinstated by Congress Retroactively  will no longer be available in 2014. These tax breaks for businesses, individuals and investors include a vast array of credits and deductions including research and development, clean energy wind energy production investment credits, accelerated business deduction for equipment purchases and many others.

Although these tax breaks were originally scheduled to expire years ago, for the past couple of years they have been allowed to expire only to be reinstated retroactively. It is anyone’s guess if we will see these reinstate as of today, January 1, 2014. Some of these include:

Business Research and Development Credits, a credit that was first enacted in 1981 and has helped spur business technology research these past two decades, will expire at the end of 2013 unless extended.

Wind Generated Power tax credit: Although tax credits have contributed toward the development of wind powered energy, the tax credit will expire at the end of 2013. However this does not affect the “48C” 30% investment tax credit that is available to selective businesses to develop domestic clean energy. See .

http://energy.gov/articles/energy-department-announces-150-million-tax-credits-invest-us-clean-energy-manufacturing

Section 179 expense deduction: For 2013, business owners can immediately deduct up to $500,000 of qualifying assets (office, equipment, machinery, etc. they need to buy to run their business). But in 2014, unless Congress acts to extend it, the limit that's immediately deductible plunges to $25,000.

Deduction for state and local sales taxes: Folks who pay little or no state income tax, but incur a large amount of state sales taxes (think about the sales tax you pay when you buy a boat, car, etc.) can choose to deduct as an itemized deduction the greater of the amount they paid in state income OR sales tax. The deduction, which was originally set to expire as part of the Bush sunset tax cuts enacted in 2001 but was originally scheduled to expire in 2011 was retroactively temporarily restored though 2013.

Tax-free IRA distributions to charity: IRA owners, age 70 ½, were allowed to distribute from their IRAs up to $100,000 tax free as long as it was sent directly to a charitable organization. Unless restored, this provision will expire in 2013.

Educators expense deduction: A tax deduction of up to $250 of out-of-pocket costs for school and classroom related supplies will expire at the end of 2013

Energy-efficient home improvement tax credits: A tax credit of $500 for the cost of “specified” energy-saving home improvements to your primary residence will expire in 2013.

Another related credit - the energy efficient home credit also expires 12/31/2013 unless restored. This is a tax credit of $2,000 per home, which is currently permitted to a contractor who builds a home to be used by the customer as a residence.

Education tax deduction: The higher education tuition deduction, which allows folks to deduct between $2,000 and $4,000 of qualified tuition costs, was retroactively restored, expiring at the end of 2013.

Exclusion from income for discharge of debt on principal residence: Folks who walk away from their home leaving the bank on the hook for the unpaid mortgage (through foreclosure, deed in lieu or short sale) are not required to report the amount of unpaid and discharged debt as taxable income in 2013. In 2014, the discharged debt will be taxable income.

A good article appeared on January 2, 2014 in the Washington Post:

http://www.washingtonpost.com/blogs/wonkblog/wp/2014/01/02/from-nascar-to-wind-power-congress-just-let-55-tax-breaks-expire/

 

 

 

 

Copyright © 1999-2013 IRS CIRCULAR 230 NOTICE:  To ensure compliance with recently enacted U.S. Treasury Department regulations, we hereby advise you that any and all tax information contained in this website should not be considered as tax advice nor intended for the use of any taxpayer for the purpose of evading or avoiding tax penalties that may be imposed pursuant to U.S. law. Furthermore, the use of any tax information contained in this communication has neither been written nor intended for the purpose of promoting, marketing, or recommending a partnership or other entity, investment plan or arrangement to any taxpayer, and such taxpayer should seek advice on the taxpayer’s particular circumstances from an independent tax advisor. The information contained throughout this web site is provided without charge, and although all efforts have been made to ensure the reliability of the information contained in this internet web site, the information contained herein should be used for general understanding only and should not be relied upon exclusively as the basis of any tax or financial decisions or for any positions taken on any tax return. Advice should only be obtained directly through the retention of a competent tax advisor. Tax Power is an established trademark of Powers & Company, Inc. and Powers Tax Services since 1999. Unauthorized use of the phrase Tax Power without expressed permission of Powers & Company, Inc. will be prosecuted to the fullest extent of the law. Last modified: January 10, 2014 The articles, guides and published information contained in this website is protected by U.S. copyright laws and cannot be reproduced in any form without the expressed permission.

       Visitors since January 1, 2010   Hit Counter