Tax Deductions Extended by Fiscal Cliff - KTVN Channel 2 - Reno Tahoe Sparks News, Weather, Video

Tax Deductions Extended by Fiscal Cliff

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As the New Year rolled in and lawmakers in Washington hammered out their solution to avoiding the fiscal cliff, they added in a few enticements to help taxpayers through this next year and beyond.

The most far-reaching was to boost the minimum tax exemption retroactively and to index future exemptions to keep pace with inflation.

Why is that so big? It gives 26-million Americans some relief and some certainty about the future and that stability is a big deal in this economic climate.

Some of the other deductions that will make a difference to most Nevadans include continuing the tuition and feed deduction for those in college or who have students in college. And educators can still deduct $250 a year on school supplies.

"That is a big one," says Linda Hagen who prepares taxes for H&R Block in Reno. "There are a lot of teachers here and they depend on that."

"A lot of people also take money out of their IRAs to make contributions to charities. It's helps them cut their taxes and help the charities. It was set to stop this year, but it will continue. So that one will affect a lot of Nevadans and a lot of charities here," Hagen added.

The other deduction she highlighted was for those who have gone through foreclosure. Without the fiscal cliff deal, they would have not only gone through losing their homes but also paid taxes on that loss. That was rectified.

And her most important tip was to be prepared and file early. H&R Block on South Wells has already begun preparing tax forms for those who have received their W2's and they expect to file close to 5,000 returns before the deadline.

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Written by Erin Breen

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