When the clock strikes midnight on January 1, 2014, another year begins and some tax breaks end.
New Year’s Day is typically the end point for temporary tax breaks, and some 2013 tax breaks are no exception. These tax breaks range from deductions for teachers, to expenses to make homes energy efficient, to sales tax deductions.
Before you get your New Year’s resolutions ready for 2014, make sure to get the most out of these tax breaks that had their heyday in 2013.
One expiring tax break is for tuition expenses. A household earning less than $160,000 can, until 2014, deduct higher education tuition expenses. The expenses must be for a dependent, and this deduction is used by a lot of people. College tuition isn’t cheap, so make sure this tax break isn’t wasted.
Taxpayers can also use the expenses made for home energy efficiency as tax credits. They range from everything to efficient water heaters to home insulation.
Don’t worry about the bigger expenses like for solar panels. Those credits will stick around for a couple more years, but it’s not a sure bet that those for smaller expenses will stay around past New Year’s Day 2014. So, ensure your appropriate expenses are made by year’s end.
Another expiring 2013 tax deduction is for sales taxes. Currently, taxpayers can deduct either the sales taxes or the state/local income taxes paid during 2013.
If you make major purchases before 2014, like for automobiles, or even boats, keep the receipts. The sales taxes can add up to the thousands, and will help you come April 15. So, go ahead and make the big buys before 2014.
If you’re a teacher, your job probably keeps you on your toes. But teachers better stay on their tax toes until the end of the year as a tax break for teachers expires come 2014.
On January 1, 2014, teachers will no longer be able to deduct expenses made for classroom supplies. Teachers can deduct up to $250 for these expenses.
To spur economic investment, tax breaks were instituted for businesses. Section 179 of the tax code allowed businesses to deduct some equipment expenses to the tune of up to $500,000. That deduction will still be there come 2014, but it’ll be drastically reduced to $25,000 – so major business expenses for infrastructure should be made sooner rather than later.
Tax breaks for charitable purposes will also expire at the end of 2013.
One of them is for people who donate a conservation easement to charities. The easement’s value qualify as a deduction, but it’s limited to half of one’s adjusted gross income less all other charitable contributions combined.
A new year can bring new chances and new opportunities, but that can also mean the end of others. Before 2014 hits, make sure to get the most out of 2013’s tax breaks.
What tax breaks do you plan on taking advantage of this year? Comment below or tweet us at @StopIRSDebt.
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