2015/2016 TAX UPDATE
Congress passed the Tax Extenders…
Among them are the $250 educator’s tax deduction (made permanent and will include professional development costs after 2015), the state sales tax itemized deduction option, the itemized deduction for mortgage insurance premiums, the elimination of the Tuition and Fees deduction and the deduction for charitable donations from IRAs (up to $100,000 for individuals 70 ½ and older).
Businesses will see: The R & D credit permanently extended; 50% bonus depreciation will stay through 2017 and then fall to 40% in 2017 and 30% in 2019, before expiring and The work opportunity tax credit for hiring economically challenged workers will be available through 2019.
**Remember you can fund your Traditional and Roth IRA retirement plans through April 18, 2016 for your 2015 returns. The limits for 2015 are $5,500 per taxpayer and an additional $1,000 catch-up for those age 50 and older.
**If you are required (age 70 ½) to take Required Minimum Distributions (RMS’s) from your qualified requirements accounts, they must be taken by year-end.
**Income Tax rates will remain the same next year.
**The 2015 standard deduction is $12,600 for joint filers plus an additional $1,250 for each spouse age 65 or older. Singles are $6,300 (or $7,850 if at least 65) and Head of Household is $9,250 ($10,800 is age 65) and the personal exemption is $4,000 per person.
**You may be eligible for Earned Income Tax Credit if you have low income and /or children.
**The 2015 mileage rate deduction was 57.5/mile; the 2016 rate is .54/mile.
**If you purchased your health insurance on the Exchange, you will need a form 1095-A to file your income tax return.
Be sure you are using a qualified Tax professional to prepare your Tax return.