A deal reached between the House, the Senate, and the White House includes dozens of tax extenders (many retroactive to the 2018 tax year) as well as the SECURE Act, which makes significant changes to various retirement-related provisions impacting both individual taxpayers and their employers. The President is expected to sign the bill.
A few highlights of these changes include:
- Reinstating the above-the-line deduction for qualified tuition expenses, the deduction for mortgage insurance premiums, and the exclusion of COD for primary residence mortgage debt retroactive for the 2018 through 2020 tax years;
- Extending the 7.5% threshold for claiming medical expense deductions for the 2019 and 2020 tax years;
- Allowing individuals age 70½ and older to make deductible contributions to traditional IRAs (for 2020 and later years);
- Increasing the age for required RMDs from age 70½ to age 72 beginning with RMDs required to be made after 2019; and
- Requiring most inherited retirement accounts to be distributed within 10 years, generally effective for account holders who die after 2019.
The bill does not address any of the technical corrections needed for TCJA provisions and does not postpone the reduction of Solar Credits.
The full text of the tax extenders and SECURE Act provisions are contained in Divisions O and Q of H.R. 1865, available at:
Get more information on tax extenders and the SECURE Act at Spidell’s Federal and California Tax Update Seminar. Click here for more information on the seminar, or see below for a list of locations.