Happy New Tax Year!
Yes, I realize that it's Jan. 7 not Jan. 1.
But six days ago we all were preoccupied with the fiscal cliff that we fell off of for about 10 hours between the final Senate and House approval of the American Taxpayer Relief Act (ATRA) of 2012.
The new 2013 individual income tax rates got most of the fiscal cliff attention. But ATRA also included the Senate Finance Committee version of tax extenders that had expired more than a year ago. The resurrected tax breaks were made retroactive to Jan. 1, 2012, meaning we can use them to save on 2012 tax returns due April 15.
They include the always popular above-the-line tax deductions for educators out-of-pocket unreimbursed expenses and higher education tuition and fees, as well as itemized write-offs for some private mortgage insurance (PMI) premiums and state and local sales taxes.
Some special tax situations also were addressed, and and I'm not just talking about the NASCAR loophole and other surprising fiscal cliff tax winners.
Older traditional IRA owners can once again roll an annual required minimum distribution directly to a charity, with a special process for RMDs taken in December 2012 before the option was retroactively reinstated. This is similar to the same dispensation that such retirement account owners got in January 2011 after the RMD rollover rule expired at the end of 2010. The regular trustee-to-trustee charitable RMD rollover is back for 2013 RMDs.
And certain homeowners who were granted mortgage debt forgiveness don't have to worry about counting that canceled debt as income in 2012 or 2013.
These are just a few of the tax issues you might want to consider now that we've had enough time to shake off our New Year's celebration headaches and focus on the new and renewed tax laws.
You'll find a collection of more tax tasks in the January Tax Moves listing over in the ol' blog's left column. Just scroll down a bit and look for the red lettering under the tax filing deadline countdown clock.
Some of these tips apply to your upcoming 2012 return. Others offer advice on how to get a head start on reducing your 2013 tax liability.
Whether you're focusing on tax filing or tax planning, I hope some of these tax moves and tips help.
And please stick with the ol' blog. More to-do tips will be posted at the start of each month.
The Daily Tax Tip feature is back for the 2013 filing season (as soon as I get this posted!).
And the regular daily blog posts (some earlier than others!) will still be around.
It's going to be a great and action packed tax season. Get ready. We can all sleep when April 16 arrives!
