Pub. 14 2015-2016 Issue 4

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 1 , 2 0 1 6 24 new jersey auto retailer Popular Tax Breaks Extended/ ACA fees Delayed by Enacted Legislation BY ROCHELLE KIMMINS, CPA A t the end of 2015, the Protecting Americans from Tax Hikes Act of 2015 (PATH Act) was passed by Congress and signed into law by President Obama. The Act makes permanent over 20 key tax breaks and extends other provisions, such as bonus depreciation for five years. Also passed late last year was the Omnibus Act that delays for two years the ACA excise tax on so-called “Cadillac” health insurance plans and imposes a one-year moratorium on the ACA health insurance provider fee. Tax Extenders for Individuals. The PATH Act makes several individual extenders permanent including: 1. State and Local Sales Taxes- the option to claim an item- ized deduction for sales tax in lieu of deducting state and local income taxes; 2. American Opportunity Credit- a partially refundable credit for education expenses up to $2,500; 3. Child Tax Credit- a partially refundable credit of $1,000 for each qualifying dependent; 4. Ea r ned Income Cred it- t he $5,000 i nc rease i n t he phase-out amount for joint filers as well as the increased 45% credit percentage for taxpayers with three or more qualifying children;