The Tax Increase Prevention Act of 2014 was introduced on Dec. 1 and signed by President Obama on Dec. 19. This act extended the tax breaks that expired at the end of 2013 for the 2014 tax year. The act did stipulate that these breaks are only for the 2014 tax year. So a new act will need to be put through in 2015 in order for these breaks to continue.

When you file for your 2014 return consider these breaks if they apply to you:

Tuition Deduction Income based limits apply to this deduction. However those who qualify can receive a tax deduction for higher education expenses. This is particularly beneficial to taxpayers who do not qualify for the education tax credits.
Home Mortgage Debt Forgiveness Exclusion Up to two million dollars of debt relief income from qualified principal residence debt can be excluded from gross income when filling your taxes, if you qualify.

Section 179 This allows small businesses and farmers to take deductions for purchases of machinery and equipment. The TIPA Act also restored 50 percent bonus depreciation. If you are not sure if your farm or business purchases qualify, contact our financial advisors before filing your taxes this year.

State and Local Sales Tax Deduction You can take an itemized deduction for sales taxes instead of for your state income taxes. This is beneficial if you live in a state with no income tax or if you purchase an expensive item like a car.

If you think you may qualify for some of these, or the other breaks that the Tax Increase Prevention Act of 2014 put into place, contact us today to discuss your options. Our tax Consulting services can save you significantly on this year’s tax return.