House Approves the Renewal of Tax Breaks

Dec 09, 2014

Last Wednesday, the U.S. House of Representatives voted to renew more than 50 expired tax breaks for individuals and businesses through the end of 2014. With an overwhelming pass of 378-46 for the one-year retroactive renewal, it now moves on to the Senate, who is increasingly likely to follow suit.

Among the biggest breaks for businesses are a tax credit for research and development, an exemption that allows financial companies such as banks and investment firms to shield foreign profits from being taxed by the U.S. and several provisions that allow businesses to write off capital investments more quickly.

The biggest tax break for individuals allows people who live in states without an income tax to deduct state and local sales taxes on their federal returns. Another protects struggling homeowners who get their mortgages reduced from paying income taxes on the amount of debt that was forgiven.

Many people are watching this bill as we are in the heart of tax planning season and a lot of these provisions could benefit business owners and individuals. The 10-year cost of the one-year bill is about $42 billion.

By: Amy Slates, CPA

Categories: Uncategorized