TEMPORARY TAX BENEFIT PROVISIONS THAT HAVE NOW EXPIRED

A number of provisions of the Code that favor taxpayers expired at the end of 2013. Historically, Congress usually gets around to reinstating such expired provisions, but in today’s partisan environment, nothing should be assumed. Indeed, in December Sen. Harry Reid introduced a bill to provide a one-year extension of nearly all of the provisions that were set to expire at year-end. The bill failed to advance.

Here is a list of most of the key provisions that are now expired, and that may (or may not) be extended retroactively.

INDIVIDUAL PROVISIONS:

-the deduction for state and local sales taxes;
- the above-the-line deduction for certain expenses of teachers;
-the above-the-line deduction for qualified tuition and related expenses;
-the deduction for mortgage insurance premiums deductible as qualified interest; 
-the exclusion of discharge of principal residence indebtedness from gross income;
-the credit for health insurance costs.

BUSINESS PROVISIONS:

  -the research and experimentation credit; 
  -the work opportunity tax credit; 
  -the increase in expensing to $500,000 / $2,000,000 and expanded definition of Section 179 property; 
  -the bonus depreciation; 
-the exceptions under Subpart F for active financing income; 
-the look-through treatment of payments between controlled foreign corporations;
  -the special rules for qualified small business stock;
-the reduction in S corporation recognition period for built-in gains tax; 
-the election to accelerate alternative minimum tax (AMT) credits in lieu of additional first-year depreciation;

OTHER PROVISIONS:

-the tax-free distributions from Individual Retirement Accounts (IRAs) for charitable purposes;
-the basis adjustment to stock of S corporations making charitable contributions of property;
-the special rules for contributions of capital gain real property for conservation purposes.