If you would like to receive our newsletter via email, please contact mike@mreillycpa.com

Michael F. Reilly, CPA, PC • Monthly Newsletter

December 2014 

TAX EXTENDERS - LATE BREAKING NEWS

 

Summary of a few of the extended tax provisions:

 

On December 16, 2014, the Senate passed the Tax Increase Prevention Act of 2014 by a vote of 76 to 16. The House had passed the legislation on December 3, 2014 by a vote of 378 to 46. The President is expected to sign the bill into law. The following information provides summaries of the tax provisions contained in the legislation.

Extension of Expiring Provisions
The law extends the following tax provisions that had expired on December 31, 2013.


State and local general sales taxes

A taxpayer can elect to deduct state and local income taxes or state and local general sales taxes as an itemized deduction, but not both. This election was set to expire for sales taxes paid after December 31, 2013. The new law extends this election for the 2014 tax year and expires for sales taxes paid after December 31, 2014

Tuition and fees deduction

A taxpayer can deduct as an above-the-line deduction certain qualified education expenses paid for eligible students. The deduction is claimed on Form 8917, Tuition and Fees Deduction, and Form 1040, line 34. This deduction was set to expire for tuition and fees paid after December 31, 2013. The new law extends this deduction for the 2014 tax year and expires for tuition and fees paid after December 31, 2014.

Section 179 expense deduction

Taxpayers can elect to expense the cost of property placed in service during the year rather than depreciate the cost over the property class life. The expense limit was $500,000 for property placed in service during tax years 2010 through 2013 with an investment limitation that began to phase out the deduction when the cost of Section 179 property placed in service during the year exceeded $2 million. This $500,000/$2,000,000 limitation was set to go back to $25,000/$200,000 for tax year 2014. The new law extends the $500,000/$2,000,000 limitations for the 2014 tax year, with the $25,000/$200,000 limitations to apply after December 31, 2014.

The new law also extends the provision that treats the cost of off-the-shelf computer software as eligible Section 179 property for the 2014 tax year.

The new law also extends the provision that allows a taxpayer to revoke the Section 179 expense deduction for the 2014 tax year.

 

ENJOY THE HOLIDAYS!

 

REMEMBER THE MINIMUM WAGE INCREASES TO $9.00 PER HOUR ON JANUARY 1, 2015



• accounting
• tax planning
• tax preparation
• audit representation
• financial statements
• business consultation
• cash flow
• computers
• payroll services
• bookkeeping

 

 

 

 

Michael F. Reilly, PC

_______________________

Certified Public Accountants

 

 

the firm where
profits start today