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New Tax Law Additions in December 2019

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2019 Year End Spending Bill

Congress has passed and the President is expected to sign a year end spending bill that incorporates some changes to the tax code

Some of these changes are as follows:

  • Excise tax on certain high-cost employer health plans(so called Cadillac Plans) and the medical devices excise tax are repealed
  • Retirement Plan Changes include an increase in the age for required minimum distributions from 70 1/2 to 72 and requires beneficiaries of IRAs and qualified plans to withdraw all money from inherited accounts within 10 years.  The bill repeals the maximum age for IRA contributions (currently 70 1/2). 
    These changes start January 1, 2020 and anyone that turns 70 1/2 after 12/31/19 will not have to start withdrawals until age 72.
  • Extends expiring tax provisions through 2020 for Sec. 108 which excludes from gross income the discharge of qualified principal residence indebtedness income; the treatment of mortgage insurance premiums as qualified residence interest when income is below certain thresholds; extends the 7.5% (instead of 10%) adjusted-gross-income floor for medical expense deductions; and extends the above the line deduction for qualified tuition and related expenses

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Donald C.Hubbard

6507 Pacific Ave. #342

Stockton, CA 95207

 

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