With the holidays over, tax-minded individuals are now focused on gathering their paperwork to file 2019 returns and project what their tax situation will look like in 2020.
Each year, Congress decides to extend or let expire various provisions of the tax law. This article summarizes some of the more commonly-used “extenders” so individuals and business owners may understand the impact of various courses of action.
The following provisions were extended through 2020:
Individuals may exclude from gross income the qualified discharge of debt related to their principal residence
An above-the-line deduction for qualified tuition and related education expenses
Mortgage insurance premiums may be incorporated into the calculation of the interest portion of itemized deductions
Medical expenses over 7.5% of adjusted gross income are considered for itemized deductions. Previously, the floor was 10%.
Businesses may qualify for a credit related to payments under a family and medical leave policy for compensation paid through December 31, 2020. We wrote about that credit earlier here.
Several credits related to alternative fuel vehicles were extended, including for the purchase of the vehicles themselves and for refueling property.
Many of these changes have phaseouts, income thresholds and other restrictions involved to obtain their benefits, so contact us online or call 800.899.4623 and we can discuss whether your situation qualifies.
Photo above courtesy of the Architect of the Capitol.