Extenders in Place for 2014

As a holiday gift to the nation, Congress passed the so-called extender bill. This extends retroactively to January 1, 2014, nearly all of the 55 provisions that expired at the end of 2013. The extension is for one year only (2014 returns). Key provisions impacting individuals include:

• State and local sales tax deduction in lieu of state and local income taxes for those who itemize deductions
• $250 above-the-line deduction for educators
• $2,000 or $4,000 above-the-line deduction for tuition and fees
• Exclusion for forgiven home mortgage interest
• Mortgage insurance premiums treated as home mortgage interest
• Rollover of up to $100,000 from an IRA to a public charity by those age 70¹/₂ and older
• Parity for transit benefits (the exclusion for monthly transit passes equal to that for free parking)
• Enhanced deduction for donations of real property for conservation purposes

The lateness of the enactment of these extenders likely will delay the start of the 2015 tax season for filing 2014 returns. An IRS update on the start of the tax season is expected soon.