Richard A. Lindsey, CPA

Lindsey & Waldo, LLC – Certified Public Accountants

  • Mar 31

    Just prior to Christmas 2015, Congress passed the PATH Act which permanently extended several tax provisions, which had been on a cycle of being temporarily extended for one or two years at a time. (See “Congress Takes a New Tack on Extenders” in the February 2016 issue of “Taxing Times”.) While there were some very important items that were permanently extended by the PATH Act, not everything was. Some provisions which expired at the end of 2016 and may be important to you include:

    • the exclusion from gross income of the discharge of qualified principal residence indebtedness income,
    • the treatment of mortgage insurance premiums as qualified residence interest, which permits a taxpayer whose income is below certain thresholds to deduct the cost of premiums on mortgage insurance purchased in connection with acquisition indebtedness on the taxpayer’s principal residence,
    • the above-the-line deduction for qualified tuition and related expenses, and
    • the 7.5% adjusted-gross-income floor for deducting medical expenses, applicable to individuals age 65 and older and their spouses, which increases to 10% in 2017.

    It is possible Congress will retroactively extend some, or all, of these provisions, but as it currently stands, these provisions have seen the end of the road.♦