Although the American Taxpayer Relief Act (ATRA) reduced uncertainty by permanently extending many of the tax cuts first enacted in 2001 and 2003 (Bush era tax cuts) there are dozens of provisions originally due to expire at the end of 2011 or 2012 that were temporarily extended until the end of 2013. Those which will expire on December 31, 2013 include the following:
- State and Local Sales tax – Taxpayers can elect to deduct state and local sales taxes in lieu of state and local income taxes.
- Mortgage insurance premiums – Allowed to be taken as qualifying residence interest payments
- IRA Distributions to Charity – Tax free distributions, up to a maximum of $100,000 per taxpayer from IRA’s to US public charities by taxpayers aged 70 plus 6 months or older, have been allowed as an alternative to take an itemised deduction.
- First year expensing of qualifying assets – The $500,000 limit for the immediate expensing of qualifying assets (non-real property-tangible assets purchased during the year) costing no more than $2,000,000 will reduce to $25,000 with phase out starting at $200,000.
- Deduction for tuition and fees – expires as of December 31, 2013.