Disappearing Deductions

Disappearing Deductions
As tax planning for the oncoming year 2014 get into full swing, it may be helpful to highlight some of the popular deductions that are currently slated to become unavailable to taxpayers by year-end. Of course, your New York Tax Attorney can give you fuller details and tell you how each of the deductions specifically apply to you.

1. A $250 deduction available to taxpayers, for expenses related to their jobs, is currently set to expire by December 31, 2013.

2. Currently, homeowners who had debts up to $2,000,000 ($1,000,000 for Married Filing Separately) canceled do not get taxed on the debt cancellation, which is otherwise taxed as income. Unless this benefit is renewed by Congress, the debts become taxable again after December 31, 2013.

3. Currently, mortgage insurance premiums paid by certain homeowners are deductible from taxable income. Unless Congress passes a rule to extend this deduction, it also expires on December 31, 2013.

4. Under current laws, taxpayers can get a tax credit of up to $500 (towards a lifetime limit) for energy efficiency improvement on their homes. This credit expires on December 31, 2013, unless Congress acts to extend it.

5. Taxpayers are currently allowed to elect to deduct either state income tax or state sales tax from their taxable income. This discretion however ends on December 31, 2013, unless Congress extends it.

6. Under certain circumstances, taxpayers may currently deduct, above-the-line, for tuition and fees paid for higher education. This benefit however ends on December 31, 2013, unless Congress duly acts to extend it.

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