Individual Tax Breaks for 2014

On December 16, 2014, the Senate passed the Tax Increase Prevention Act of 2014 (TIPA), which the House had passed on December 3. The act extends through December 31, 2014, certain tax relief provisions that expired at the end of 2013.

Several of these provisions can produce significant savings for taxpayers on their 2014 income tax returns, but action before January 1, 2015 may be needed to take advantage of some of them. Here’s a brief summary of the extended individual tax breaks for 2014 that may be most likely to benefit you.

Individual Tax Breaks

• Deduction for state and local sales tax in lieu of state and local income tax
• Tuition and fees deduction
• Ability of taxpayers age 70 1/2 or older to make a direct tax-free rollover from an IRA to charity
• Certain home and energy-related breaks
• Home debt forgiveness exclusion
• Deadline for investing in qualified small business stock that will be eligible for the 100% gain exclusion if held for at least five years

Keep in mind that many breaks with more limited applicability have also been extended; it’s possible some of them could also benefit you. Also, many breaks are subject to a variety of rules and limitations. So please contact your tax advisor or the experts at GTM to determine exactly how you can make the most of this tax relief.