$15.4 Billion in Tax Benefits Expired on Dec. 31, 2016: What It Means For YOU
On Dec. 31, 2016, four popular tax benefits that delivered more than $15.4 billion in tax benefits (in 2014) ended. They are:
- Tuition and fees deduction
- Mortgage insurance premium deduction
- Nonbusiness energy property credit
- Mortgage debt forgiveness exclusion
Unless new legislation is passed to extend them, taxpayers can claim the above tax benefits for the last time on their 2016 tax return.
Why The Change?
This change is part of the PATH Act. Passed in late 2015, the law contains dozens of tax provisions, many of which go into effect this year. The new, expansive law affords taxpayers the opportunity to utilize some common tax breaks. It also permanently extends many tax benefits, taking millions of taxpayers out of the repeating cycle of uncertainty about many tax benefits – and opening the door for more accurate and useful tax planning. However, some temporary tax benefits were extended for only a few years.
[REMINDER: If you have not filed yet, make sure you claim the above tax benefits on your 2016 tax return if you’re eligible.]
Identify Your Tax Benefits
First, review your previous years’ tax returns to see if you’ve used of these benefits in the past. Then see if any of them still apply, or apply for the first time in order to maximize your results for your upcoming tax return.
In tax year 2017, you will need to look elsewhere for tax benefits and relief for educational, home, and energy expenses. In fact, a tax professional at Block Advisors could help you determine if you qualify for tax breaks in these areas under different provisions of the tax code.
Because the tax landscape has changed recently, it is more important than ever to talk with a tax professional and plan for next year’s tax return, so connect with a Tax Advisor at Block Advisors now!