Are there steps you can take that will lower your federal income-tax liability? Given the tax law’s complexity, the answer is probably “yes.” Effective tax planning can help reduce your tax bill, leaving you with more money to meet other financial obligations and pursue your goals.
A few tax items to note for 2015:
- New individual shared responsibility payment (“Individual Mandate”): Under the Affordable Care Act, for 2015. certain individuals will be required to have health insurance:
- Individuals who are subject to the mandate face a penalty of the higher of 2% of your household income or a flat fee of $325 per uninsured adult.
- In addition, certain individuals will qualify for subsidies through a tax credit program to help pay for health insurance
- Tax issues for Medtronic Shareholders: Shareholders of Medtronic may face an unwanted tax bill due to the inversion with Covidien in 2013. If you hold shares from before this transaction, be sure to consider the tax impact.
- Increased Minnesota Estate Tax Exemption: Minnesota increased the estate tax exemption for 2015 from $1.2 million to $1.4 million.
- The exemption will increase by $200,000 per year before reaching a maximum of $2 million in 2018.
- Depreciation for businesses: Currently, no legislation has been passed regarding 2015 tax depreciation. Without a last minute bill passing congress, tax depreciation will substantially change for 2015, including:
- Maximum Section 179 of $25,000 for 2015 compared to $500,000 for 2014.
- No special 50% bonus depreciation on eligible assets bought during 2015.
In addition to the depreciation rules discussed above, several other important tax breaks have expired at the end of last year. Unless Congress acts to extend them, your tax bill may increase unexpectedly. Froehling Anderson can help you improve your tax situation and plan for the changes in order to minimize your taxes.
Please contact our office at 952.979.3100 as soon as possible to allow adequate time for your tax planning.