Update on Expired Federal Tax Provisions

October 1, 2014

The industry is waiting on Congress to act on federal tax provisions that expired at the end of 2013. The earliest any extender legislation will be taken up by Congress is after the election in November. Once again, it appears that any extension of these provisions will not take place until late December.

Right now it appears that a two year extension is on the table but it is not clear that all of the expired provisions will be extended. So we will have to wait and see what Congress does include in any extender bill that is passed in December.

With that in mind, below is a list of the some of the 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Provisions no longer applicable for tax year 2014 returns: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 for 2014:

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

Stay tuned for more information on which provisions will be extended and what impact the lateness of any extender legislation passage will have on the start of the 2015 filing season.

See below for a complete listing of the expired federal tax provisions:

• Individual
• Business