Must Know Tax Tips for the 2015 Filing Season
TaxAudit.com releases filing season tax tips and new law updates - are you prepared?
CITRUS HEIGHTS, Calif., Jan. 8, 2015 /PRNewswire/ -- TaxAudit.com, the IRS audit experts that handle more than 24,000 audits each year, today released its annual end-of-year tax tips for U.S. taxpayers.
Many new tax laws have become effective for 2014, including rules for health insurance, capitalization of business property, personal and dependent exemptions and IRA rollover rules, among others. Some important new rules taxpayers and tax preparers should be aware of include:
Healthcare related tips
- The following Affordable Care Act rules become effective for 2014:
- Minimum essential coverage requirements become effective for 2014.
- Taxpayers (and the taxpayer's dependents or individuals who could be dependents but were not claimed) without minimum essential coverage are subject to penalties unless they qualify for exemption.
- Relief is available for taxpayers covered under certain non-qualifying plans.
- Individuals who purchase health insurance through federal or state-sponsored Marketplaces must show proof and provide policy numbers.
- To qualify for certain exemptions, individuals must show proof and submit an application to the Health Insurance Marketplace.
- Premium Tax Credit: Individuals must meet all conditions to qualify for the credit including:
- Buying their insurance through the Marketplace (also known as the Exchange).
- Meeting certain income limits.
- Must be ineligible for coverage through employer or other government plan.
- Cannot be claimed as a dependent on someone else's return.
- Cannot file a Married Filing Separately tax return (certain exclusions apply).
- Minimum essential coverage requirements become effective for 2014.
- Employer Mandate
- Beginning in 2015, large businesses (any business with 50 or more Full Time Equivalent [FTE] employees) must provide health coverage or face financial penalties. The coverage must meet the Affordability and Minimum Value standards.
Additional tips
- Rules for capitalization of business property have changed.
- Improvements are now defined as betterments, adaptations or restorations with specific subcategories such as materials and supplies.
- Certain materials and supplies can be expensed but must be defined as "incidental" and "non-incidental."
- New de minimis rules apply.
- Higher contribution limits for pension plans apply but not IRAs.
- Personal and dependent exemptions increase to $3,950 per person.
- The 2014 Standard Deductions have changed:
- $6,200 for single taxpayers.
- $9,100 for head of household.
- $12,400 for married couples filing jointly.
- New IRS interpretation of IRA rollover rules will be enforced beginning in 2015. Only one 60-day rollover per 12-month period will be allowed for all IRAs. Trustee-to-trustee transfers do not fall under this limitation.
- Virtual currency (e.g., Bitcoin) is now treated as property for U.S. Federal Tax purposes.
- Applies to wages paid.
- Payments to independent contractors.
- Gains and losses.
- Information reporting required.
- On December 19th, President Obama signed the Tax Increase Prevention Act, which retroactively extended for one year more than 50 tax provisions that expired at the end of 2013. The deductions for educator's expenses, state and local sales taxes, and tuition and fees, and the Research and Development Credit for businesses are among the breaks that have been extended, along with relief for homeowners with cancelled debt from foreclosures and short sales. The bill was signed barely in time for the IRS and tax software companies to finalize the 2014 forms and publications for tax season. The bill did not address tax year 2015 and beyond, so at this point most of the extended provisions have already expired again.
Please note: This is only a short list of some of the new tax rules for 2014. Please spend time with your tax preparer and learn the rules at IRS.gov so you and your advisor are knowledgeable about qualifying expenses, eligible purchases, contributions, gifts, etc., so you can reduce your tax burden.
For more information, please visit www.taxaudit.com.
About TaxAudit.com
TaxAudit.com is the largest and fastest-growing audit defense service in the country for taxpaying individuals, small businesses and tax preparers, with nearly 5 million members and 24,000 audits handled and resolved each year.
TaxAudit.com offers prepaid IRS audit representation and defends taxpayers from the moment they receive an audit notice through to the best possible resolution. TaxAudit.com members receive expert tax representation, relieving taxpayers from the nightmare of being audited, at a price point any taxpayer can afford.
TaxAudit.com is headquartered in Citrus Heights, CA.
SOURCE TaxAudit.com
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