Which popular tax breaks will stick around now the election’s over? Here are some predictions.
A lot of time, money and energy was spent predicting the outcome of the presidential election. But prediction season’s not over yet – a lot of next year’s tax policy remains unclear. MarketWatch takes a stab at how some personal tax issues may be affected. Here’s a few…
Earned Income Tax Credit
Legislation enacted in previous years increased the earned-income credit for families with three or more qualifying children and allowed married joint-filing couples to earn more without having their credits reduced. These changes, which help lower-income families, are scheduled to expire at year-end.
Prediction: The current more-generous rules will be extended through at least 2013.
Higher-Education Tuition Deduction
This write-off, which can amount to as much as $4,000 or $2,000 for higher-income folks, expired at the end of 2011.
Prediction: The deduction will be retroactively restored for 2012 and probably extended through at least 2013.
$500 Energy-Efficient Home Improvement Credit
For 2011, taxpayers could claim a tax credit of up to $500 for certain energy-saving improvements to a principal residence. This break expired at the end of 2011.
Prediction: This one is probably gone for good.
There’s nearly a dozen more predictions over at MarketWatch, and if you’re ready to start planning taxes, check out the links below. (We’ll have a lot more to say during tax season when things are clearer.)