2014 YEAR-END TAX TIPS
1. AFFORDABLE CARE ACT (“OBAMACARE”)
Many clients will be able to claim additional tax credits based on health care premiums paid resulting in increased refunds!
But, you have to provide proof of “minimum coverage” for at least 9 months of 2014 for every person on your return! Failure to do this will result in penalties from $47.50 to several hundred dollars. This includes you, your spouse (if any) and any child or other dependent you may be able to and want to claim on your return.
You will receive and need to have “Proof of Coverage” (Form 1095) for each person you take as a dependent on your return. You will receive these forms in January in the same manner you get your W-2’s and 1099’s. BRING THESE TO YOUR TAX APPOINTMENT!
2. This year we will, once again, electronically file BOTH your federal and state returns for FREE!!!
3. Meals & Miles – Mileage rate up to 56.0 cents for 2014. Regardless of which method is used to deduct vehicle expenses, good records must be kept; i.e. you must keep a log, diary, or calendar and mark business trips taken and mileage for them or you will lost mileage write-offs if you should be audited. MEAL EXPENSES for travel & entertainment recorded in same log.
4. Non-cash contributions! Donate clothing to Salvation Army or other charities. Use ¼ to 1/3 original value; list clothing items with values on sheets of paper. Get charity to stamp the paper work when making these donations. We’ll deduct on your tax return. YOU GET A DEDUCTION WITHOUT WRITING A CHECK or contribute appreciated STOCK instead of cash. You get full value as a charitable write-off & don’t pay on the gain. ALERT!!! Write “Very Good Used Condition” on your receipt.
5. Sell Stock before December 31st – losses can be used to offset gains on other sales; they can also produce an additional $3,000.00 write-off against other income.
6. Pre-pay mortgage, real estate and state and local taxes (prior to 12/31/2014) and get a deduction on your Federal 2014 return. Pre-pay deductible expenses on or by December 31 (use credit cards if need be) and deduct on the year’s return.