I have touched upon the main tax issues that will changing in 2015, but below are a few additional issues that you should be aware of when beginning to plan for 2015:
Limited to One IRA Rollover per Year: Any taxpayer who receives an IRA distribution on or after January 1, 2015, will not be able to roll over any portion of the distribution into an IRA if they rolled over any distributions in the previous year. Prior to 2015, you were allowed one rollover, per year, per IRA.
Single Distribution Rule for Retirement Plans: I talked about these rules in-depth here last week. The main takeaway is that even if your distribution is directed into multiple accounts, it will only count as a single distribution for tax purposes.
Mileage Rate: The following mileage rate deductions will be implemented in 2015:
- Standard: 57.5 center per mile (2014: 56.0 cents per mile)
- Medical and Moving: 23.0 cents per mile (2014: 23.5 cents per mile)
- Charitable: 14.0 cents per mile (2014: 14.0 cents per mile)
Tax Benefits Adjusted for Inflation: We have been accustomed to standard deductions and income thresholds rising each year to offset inflation. Taxpayers will continue to benefit from the trend as the 2015 rates and deductions have increased. The full list of adjustments can be seen on the IRS website.
ABLE Accounts for Disabled May be Established: States can now establish a tax-exempt Achieving a Better Life Experience (“ABLE”) account to assist those with disabilities. Amounts in these accounts will accumulate on a tax-exempt (or tax-deferred) basis and distributions are tax-free if made for qualified disability expenses.
Limit on Electronic Refunds: In order to deter fraud and identity theft, the IRS is limiting the number of refunds electronically deposited into a single account to three in 2015.
These changes will have less of an immediate impact (for most) than the Affordable Care Act, but they can plan a large role in forming the framework of your 2015 tax planning approach.