Federal Tax Provisions Not Applicable for 2014 Tax Returns

April 23, 2014

This is a reminder that a number of tax provisions expired at the end of 2013.

Looking ahead to next year’s filing season, everyone will need to keep an eye out on what Congress does with regard to these expired tax provisions.

Below is a list of the most used provisions that have either expired or have significantly changed for Tax Year 2014.

Provisions no longer applicable for Tax Year 2014 returns:

• $250 Educator Expense Deduction - Form 1040, line 23
• Tuition and Fees Deduction - Form 8917
• Itemized Deduction for Sales Tax
• 50% Bonus Depreciation
• Exclusion of gain from income for foreclosed home mortgage debt (Form 982)
• 15 year straight line depreciation allowed for qualified leasehold restaurant and retail improvements
• Tax-free distributions from IRAs for charitable purposes
• Nonbusiness energy property tax credit on Form 5695
• Contributions of capital gain real property made for conservation purposes (50% limitation applies instead of 30% limitation)

Also note that the following Section 179 Expense provisions have been reduced as follows:

• Maximum Section 179 Deduction amount: $25,000
• Maximum Cost before Section 179: $200,000
• Qualified Real Property category is eliminated

There is movement in Congress to extend most of these provisions before the end of this year. But, as in the past, there is a strong possibility that any legislation extending them will not take place until December 2014. Stay tuned for more information on what occurs with these provisions and what impact the lateness of the passage of any legislation will have on the start of the 2015 filing season.

For a complete listing of all expired tax provisions that affect both individuals and businesses, see the Things to Know for the Current Tax Year section (under “Extended provisions applicable to 2013 only” bullet) of the Tax Resource Center page on the CrossLink Tax website.