New Budget Bill Extends Many Expiring Tax Provisions
Congress passed the Taxpayer Certainty and Disaster Relief Act of 2019 as part of the Further Consolidated Appropriations Act on December 19, 2019, and on December 20, President Trump signed the bill into law.
The Act contains disaster relief provisions, repeals some of the tax provisions of the Affordable Care Act, and increases funding for the Internal Revenue Service. The Disaster Relief Act extends more than 30 expired tax provisions through 2020.
Key provisions extended through 2020 include:
- Mortgage debt forgiveness on a principal residence in certain situations
- The ability to deduct mortgage insurance premiums as an itemized deduction
- Medical deduction for qualified expenses exceeding 7.5% of adjusted gross income (versus 10%)
- Tuition and fees deduction as an “above-the-line” deduction
- Work Opportunity Tax Credit (WOTC) for employers hiring from certain targeted pools of employees
- Family and Medical Leave credit for employers meeting certain criteria and offering such benefits
- Plug-in vehicle credit for certain qualifying vehicles
Provisions that were not included in the Act:
- Reinstatement of unreimbursed employee expenses being deductible as an itemized deduction
- Increase in the $10,000 cap on state and local tax deductions allowed as itemized deductions
Contact your Yeo & Yeo tax professional with questions about how these changes may impact your specific tax situation.