The new tax law signed last month extended a number of tax breaks that had expired at the end of 2011 or 2012. These tax breaks could affect the 2012 return you’ll be filing soon, and they may also lower your 2013 tax bill.
Don’t overlook any that apply to you or your business. Here’s a quick overview:
EXTENDED FOR INDIVIDUALS:
* The optional deduction for state and local sales taxes in lieu of deducting state and local income taxes.
* The above-the-line deduction for up to $4,000 for qualified tuition and related expenses.
* The above-the-line deduction for up to $250 for classroom supplies purchased by teachers.
* The deduction for mortgage insurance premiums.
* Allowing taxpayers 70½ or older to make tax-free contributions of up to $100,000 from an IRA to a charity.
* The exclusion from income for cancellation of mortgage debt of up to $2 million on a principal residence.
EXTENDED FOR BUSINESSES:
* An increase to $500,000 in the Section 179 first-year expensing option for the purchase of new or used business equipment, with an investment limit of $2,000,000.
* 50% bonus depreciation on purchases of new business equipment.
* The research tax credit and the work opportunity tax credit.
* 15-year depreciation for leasehold improvements, restaurant property, and retail space improvements.
For assistance in identifying and applying all the deductions and credits that lower your taxes – both for 2012 and 2013 – please contact our office, 817.460.3143