Once again the Senate is considering extending many tax breaks from 2013 into 2014. If you are one of the many Americans who are still reeling from the recent tax season, this news may be a reprieve.
The Senate, which has oscillated between renewing and laying to rest expired tax breaks, has once again conceded to looking over previously rescinded tax benefits.
EXPIRE (Expiring Provisions Improvement Reform and Efficiency) is the name of SB 2260. Since the bill was introduced to the Senate at the end of April, it has made its way to the Senate Finance Committee, and to the Senate floor, with only three opponents voting “No.”
Below are some key tax benefits that may be extended to Americans next tax season:
College costs continue to be tax deductible. With the expense of higher education constantly climbing, the tuition and fees deduction allows those that are eligible, to claim up to $4,000 in education expenses.
Eliminating deductions for teachers. If you were upset that Congress would allow this one to expire, you are like many other Americans who felt as though it was unfair for teachers to pay out of pocket for classroom expenses. Teachers do not have to itemize their taxes to receive this $250 tax bonus.
Public transportation and parking benefits. The current bill could increase the transit and vanpool deductions to $250, and offer breaks from bike sharing. “Every other year or so, Congress decides that it wants to reward those that take transit or vanpool with roughly the same tax benefits as those who drive to work and park. 2014 didn’t start out being one of those years: employer-provided transit and vanpool benefits were only allowed up to $130 per month while those that opted to drive and park could receive up to $250 in tax-free employment related reimbursements,” wrote Forbes contributor Kelly Phillips-Erb.
Energy expenses. The current bill would reinstall the 10% energy credit. To qualify you must make energy-efficient home improvements that meet the energy tax credit’s requirements.
Phillips-Erb poignantly shows how if they approve all of these tax breaks it may lead to an unbalanced budget, in her article.
“If they give all of the tax breaks the thumbs up, it would add about $85 billion to the budget deficit,” wrote Phillips-Erb. “If you feel like you’ve heard this one before, you have. This notion of letting tax breaks expire and then extending them retroactively is nothing new. It’s become quite the fashion in Congress to let tax breaks expire so that they can talk about costs saved and then plug them back in – but only for a little while. Most of the time, tax extenders last just a year or two. The current bill would extend the breaks for 2014 and 2015.”
For now the bill is stalled with 53-40 vote along party lines. This means that the measure still up to debate and can be brought back for consideration at a later time.
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