Tax Increase Prevention Act of 2014 – Passed
On Tuesday, December 16th, Congress passed the Tax Increase Prevention Act of 2014 (TIPA). The Tax Increase Prevention Act renews various individual and business extenders retroactively for one year to January 1, 2014. Below is a list of some of the more substantial tax extenders:


Business Extenders:

  • Bonus Depreciation
    • Extends 50% bonus depreciation on new purchases
  • Code Section 179 Expensing
    • Sets the expensing dollar limit at $500,000 for 2014 with a $2 Million overall investment limit
  • Qualified Leasehold/Retail Improvements, Restaurant Property
    • Qualified leasehold, retail, and restaurant improvements may be treated as Code Section 179 property but with a lower cap of $250,000
  • Research Tax Credit
  • Work Opportunity Tax Credit
  • 100% Exclusion for Gain on Qualified Small Business Stock
  • Reduced Recognition Period for S Corporation Built-In Gains Tax


Individual Extenders:

  • State and Local Sales Tax Deduction
  • Higher Education Deduction
  • Teachers’ Classroom Expense Deduction
  • Mortgage Debt Exclusion
  • Mortgage Insurance Premium Deduction
  • Charitable Distributions From IRAs
  • Transit Benefits Parity
  • Contributions of Real Property for Conservation Purposes


Energy Extenders:

  • Code Section 25C Credit
    • For qualified energy efficiency improvements to residential property- e.g., such as adding insulation, energy efficient exterior windows, and energy efficient heating and air conditioning
  • Production Tax Credit
    • Provides a per-kilowatt-hour tax credit for electricity generated by qualified energy sources and sold by the taxpayer to an unrelated person
  • Biodiesel and Renewable Diesel Production Credit


Some Extenders NOT Extended:

  • Plug-in Electric Vehicle Credit
  • Energy- Efficient Appliance Credit
  • Placed-In- Service Date for Partial Expensing of Certain Refinery Property
  • New York Liberty Zone Tax Exempt Bond Financing
  • Health Coverage Credit for Displaced Workers

This newly passed law also includes Achieving a Better Life Experience (ABLE) Act which will create tax-favored savings accounts for individuals with disabilities. This savings account can be used to pay education and personal support costs.


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