With tax reform off the to-do list for 2014… Taxwriters are looking at expired tax breaks. A host of tax credits and write-offs lapsed after 2013, ones important to individuals and businesses alike. At first, these provisions were supposed to be handled as part of the tax overhaul process. But momentum
for that has waned, especially now that the chairmen of the tax committees have said they are retiring. So, Congress has begun working on separate legislation that is devoted solely to the expired tax provisions.
Some key breaks are certain to be revived, retroactive to Jan. 1, 2014. For individuals, this includes allowing folks 70½ and older to make direct distributions of up to $100,000 annually from their IRAs to charity and letting debtors exclude up to $2 million of forgiven debt on their primary homes. Deductions for teachers’ class supplies, private mortgage insurance and college tuition. And the election to write off state and local sales taxes instead of state income taxes.
For businesses, 50% bonus depreciation, the ability to expense up to $500,000 of assets and the R&D credit. Also, 15-year write-offs for renovations of restaurants and retail stores, as well as for improvements that landlords make for retail tenants.