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The US Senate approved legislation, which the House already passed, to extend for one year more than 50 tax provisions that had expired at the end of 2013. The pending retroactive enactment of this legislation will impact the 2014 taxes for many individuals and businesses. Among the key provisions that are extended in the Tax Increase Prevention Act of 2014 are:

Business Provisions

  • Bonus depreciation
  • Section 179 expensing
  • 15 year write-off for restaurant property and qualified leasehold and retail improvement property
  • Research and development credit
  • Work opportunity tax credit
  • Reduction in S corporation built in gains period
  • 100% exclusion of gain on certain small business stock

Individual Provisions

  • Above the line deduction for educator expenses
  • Exclusion for discharged home mortgage debt
  • Deduction for sales and use tax in lieu of state income taxes
  • Above the line deduction for higher education expenses
  • Nontaxable IRA transfers to eligible charities

Energy-Related Provisions

  • Nonbusiness energy property credit
  • New energy efficient home credit
  • Energy efficient commercial building deduction
  • Alternate fuel credit
  • Biodiesel mixture excise tax credit
The bill now goes to President Obama and is expected to be signed into law quickly. Once signed by the President, these provisions will become effective January 1, 2014 but are due to expire in a short 14 days from now. So unless there is some action by Congress in early 2015 relating to these provisions, we may have another year of tax uncertainty ahead of us.


For more information on the Tax Increase Prevention Act of 2014 or how these tax breaks apply to you or your business, please contact your local UHY LLP professional.