Congress is a freaking joke! They let several income tax provisions expire December 31, 2017, but in the recent SECURE Act, they revived some of them, retroactively.
So, in order to take advantage of these, you need to amend your 2018 tax return. For some of them, it might make sense, others not so much, but you can use them for 2019 and 2020 without fear!
Some of the most common that were renewed:
Medical Expenses: Instead of expenses in excess of 10% of adjusted gross income, the Act lowers it back to the previous 7.5%. That’s still a large threshold for many, but it might warrant an amendment
Mortgage Insurance: Premiums, commonly called PMI, can be deducted as interest, subject to other restrictions.
Tuition and Fees: Eligible tuition and fees are again allowed as a deduction to adjusted gross income up to $4,000 for a joint return. No double benefit for tax credits
Some not so common:
Residential energy-efficiency improvement credit
Exclusion from income for cancellation of debt on your principal residence. Must have been used to acquire the residence, up to $2 million.
Empowerment Zone tax incentives
Energy Efficient commercial buildings deduction
Specific to Business:
New Markets Credit (extended through 2020)
Employer Credit for paid family and medical leave (extended through 2020)
Work Opportunity Credit (extended through 2020)
Accelerated deprecation for business property on formerIndian Reservations. May not be of much use with the bonus depreciation and increased section 179 limits, but it is worth noting.
Indian Employment Credit. 20% Credit for the first $20k of wages and benefits paid to an eligible employee
As you can see, as always tax planning remains a complicated matter. If you're not sure about how these new rules will affect your taxes, use the button below to schedule a free consultation today.