Tax Tips 2017_2016
Tax filing season begins January 23, 2017 (for year 2016 tax returns)
The regular due date is April 18, 2017 (individuals) and March 15, 2017 (most business returns including partnerships) Extensions of time (for filing forms only, no payment delays are allowed) are granted for six months,
There are not many substantive tax law changes but the penalty for non compliance with health care law is $695 for each adult and $347.50 for each child subject to some calculations on household income and changes in marital status during the year.
Items extended through year 2016 by the 2015 Tax Act include:
Mortgage insurance premiums to acquire, construct, or improve a first or second residence are deductible, but phased out for high income taxpayers.
Qualified tuition is deductible up to $4,000 but scaled back to $2,000 for high income taxpayers. Note-the American Opportunity and the Lifelong Learning tax credit may provided a better tax benefit, but they are income restricted and high income taxpayers cannot use the credits.
A $500 energy tax credit is available for energy saving improvements to your principal residence. The credit is 10% of eligible costs for energy efficient insulation, windows, doors, and roofing.
A 30% tax credit is available for qualified solar water heating property and solar property expenditures. This credit extends into year 2021. Rate reductions in the tax credit will begin in year 2020.
Remember to fund any available IRA plans, if eligible, from earned income before April 15, 2017.