COVID-19 Relief Law Boosts Temporary Tax Deductions and Credits

Reblogger
Real Estate Agent with KW Elite

      I missed this blog post earlier in the year . Apparently I was giving out wrong advice concerning PMI , no longer being Tax Deductible ! I actually have two Settled Buyers I now need to recontact with this good news  ! How about you ......,,,........................................................

 

Boy , it’s harder to hit fifthty words than one thinks  !

Original content by Kelly Green-Krist 34463

The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted on December 27, 2020, deals with the annual tax extenders. Congress made some of them permanent, while others got short- or long-term extensions.

These are the big five Form 1040 tax breaks that were scheduled to expire on December 31, 2020:

  1. Exclusion from income for cancellation of acquisition debt on your principal residence (up to $2 million)
  2. Deduction for mortgage insurance premiums as residence interest
  3. 7.5 percent floor to deduct medical expenses (instead of 10 percent)
  4. Above-the-line deduction for tuition and fees
  5. Non-business energy property tax credit for energy-efficient improvements to your principal residence

Here is what Congress did with each of these five provisions:

  1. Cancellation of debt. Extended through tax year 2025, but with a reduced maximum exclusion from $2 million to $750,000 for discharges of indebtedness after December 31, 2020.
  2. Mortgage insurance premiums. Extended through tax year 2021 only.
  3. 7.5 percent floor for itemized medical deductions. This provision is now permanent!
  4. Tuition and fees deduction. Eliminated, but the lifetime learning tax credit phase-out limit was increased to $80,000 (or $160,000 on a joint return) to increase access to this tax benefit.
  5. Principal home energy tax credit. Extended through tax year 2021 only.

Of course, Congress extended dozens and dozens of other extenders. If you would like to discuss the extenders, please don’t hesitate to call us at (919) 290-1011.

Posted by

 

Michael J. Perry

KELLER WILLIAMS Elite

www.lancaster4sale.com  

 

1280 Plaza Blvd. , Lancaster, PA 17601

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Longtime West Lampeter resident and Lancaster County Realtor!

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Comments (3)

Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Michael. Who truly understands the tax laws? Not the IRS! Enjoy your day.

May 28, 2021 04:43 AM
Bill Salvatore - YVP Blog
Arizona Elite Properties - Chandler, AZ
Realtor - Valley of the Sun / golfArizona@cox.net

I comment you interpretting the tax code, well done. Thanks for posting, make it a great friday and look the weekend is near.  Bill Salvatore

May 28, 2021 05:09 AM
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Michael,

I know that our tax expert stays on top of all these...Thank you for sharing this with us. Enjoy the long weekend. A

May 28, 2021 07:20 AM