Good news, bad news – retroactive tax changes

Good news.  New legislation passed February 8, 2018 extends through 2017 several tax breaks that had expired in 2016. That is good news for many taxpayers.

While there are many, many provisions in the “Bipartisan Budget Act of 2018”, the most common breaks affecting our clients in Ohio are the following:

  • Mortgage insurance premium deduction (PMI)
  • Tuition and fees deduction
  • Energy credit
  • Qualified principal residence debt exclusion (very significant for those foreclosed on in 2017)

Bad news. This retroactive change means taxpayers may not have the necessary information to include on the tax return. For example, your mortgage interest statement may not have included the PMI amount.Or you may not have kept the receipts for the energy efficient windows, furnace and insulation you purchased in 2017.

Some taxpayers have already filed and will need to amend their tax return to tax advantage of the updated law.

Lastly, taxpayers who want to take advantage of these provisions will have to wait until tax software is updated and approved.

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