Even though the payroll tax was extended for another two months there are still a large number of laws that will expire at the end of the year. The expiring laws will affect both individuals and businesses.
Businesses will no longer be able to claim 100% bonus depreciation for the first-year. The research and development credit and the work opportunity credit will also end at the stroke of midnight on December 31st. Some other less widely used credits that expire include the plug-in electric and conversions, biodiesel and renewable diesel, alternative fuel and alternative fuel mixture, Indian employment, and railroad track maintenance. But for those who are sick of all the credits for green energy there is also a credit for mine rescue team training and refined coal production facility.
Individuals also need to remember there are a few changes for them also. The biggest is expiration of the alternative minimum tax (AMT) patch. The AMT will revert to $45,000 for married individuals and $33,750 for unmarried individuals. Nonrefundable credits can't be used to offset the AMT.except in limited number of exceptions. Other expiring credits include: adoption and adoption assistance, school teacher expenses, mortgage insurance premiums and the energy property credit.
This is just an overview of some of the changes to the federal tax code. There are also state and local tax changes that may affect your tax return. You can contact your tax accountant for information specific to your return.
Labels: tax changes