Credits, deductions due to expire revived for tax season
WASHINGTON — Taxpayers preparing to file their 2012 returns can breathe a collective sigh of relief.
The alternative minimum tax, or AMT, has been patched — permanently — and several tax credits and deductions that technically expired at the end of 2011 were extended as part of the “fiscal cliff” legislation that Congress passed and President Obama signed into law in January.
“It certainly puts back into place many of the tax benefits that had expired for many people,” said Mark Steber, chief tax officer with Jackson Hewitt Tax Services. “The extenders will be back on people's tax returns, making their 2012 refunds larger than they would have been.”
But the delay in congressional action could mean confusion for some taxpayers over what credits and deductions still exist.
That could make going it alone on tax day costly. Experts say people should seek some guidance, whether it's from a professional tax preparer, up-to-date software programs or tax guides, before filing returns.
More than 90 percent of taxpayers go to a tax preparer or use tax software to file their returns, estimated Jim Buttonow, a 20-year IRS veteran who is vice president of products for New River Innovation, a tax technology company.
The Internal Revenue Service will begin accepting returns on Jan. 30 — an eight-day delay necessitated by the late congressional action.
“We have worked hard to open tax season as soon as possible,” IRS Acting Commissioner Steven T. Miller said. “This date ensures we have the time we need to update and test our processing systems.”
The agency said most taxpayers — more than 120 million households — would be able to begin filing on Jan. 30. But filing for those claiming energy credits, depreciation of property or general business credits will be delayed until late February or March.
Last year, the agency received 137 million returns.
Electronic filing increased by 6.2 percent to 113 million in 2012, an upward trend that tax experts expect to continue. Although most electronically filed returns are prepared by tax professionals, an increasing percentage of individuals are doing their own returns electronically.
Nearly 104 million people received refunds last year totaling about $283 billion. The average refund was $2,707, slightly less than the year before, according to the IRS.
As people sit down to do their taxes, they'll find that the standard deduction has been adjusted higher for inflation, to $11,900 for married couples filing jointly, $8,700 for heads of households and $5,950 for single taxpayers.
About two-thirds of taxpayers claim the standard deduction, according to Barbara Weltman, an author of J.K. Lasser's Tax Guide 2013.
Each personal exemption is worth $3,800 this year, up from $3,700 in 2011.
There are higher mileage rate deductions — 55.5 cents per mile if you use your car for business, 23 cents per mile for moving or medical issues and 14 cents a mile for charity.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- NexTier Bank buys Oakland’s Eureka to increase coverage in Western Pennsylvania
- Robust jobs report could force Federal Reserve to raise interest rates
- Alcoa putting $60M into Upper Burrell tech center expansion
- Stocks end roller-coaster day higher
- U.S. adds 173,000 jobs in August, dropping unemployment rate to 5.1 percent
- Indian SUV maker Mahindra to debut electric scooter in U.S.
- Shale gas violations down as DEP steps up inspections
- A handful of tech startups plan big changes to the auto industry
- Fifth Third Bank selling Pittsburgh branches to First National
- PPG’s new CEO to push organic growth with existing clients
- Coal company, UMW settle suit over use of non-union workers