Illinois and Missouri Tax Law News
Increase in State Exemption Amount for Tax Year 2014 Announced: The Illinois Department of Revenue announced that for Tax Year 2014, the personal exemption amount will be increased to $2,150. This is up from the 2013 level of $2,100.
Increase in State Earned Income Credit: The Illinois Earned Income Credit (EIC) percentage has increased from 7.5 percent to 10 percent. If you claimed a federal EIC, you may now claim 10 percent of this credit on your Illinois return.
Illinois Internet and Non-resident state Sales Tax Law: Illinois now requires Internet sellers to charge and collect the 6.25% State of Illinois sales tax. For more information, contact one of our tax professionals today.
Military Personnel: The Illinois Department of Revenue has produced a booklet to help guide military personnel on the completion of their Illinois Tax Return. Publication 102 sets forth guidelines for military personnel on the completion of their Illinois Tax Return.
New Jobs Deduction: The State of Missouri has extended the News Job Deduction. Generally, for taxable years ending on or before December 31, 2014, if a small business creates new jobs, it may qualify to claim a deduction in the taxable year each new employee completes at least 52 weeks of full-time employment. The deduction may be claimed on the Individual Income Tax Return or a Corporation Income Tax Return. The application form for the credit, Form MO-NJD, must be completed and submitted with the return.
Missouri Changes Taxable Amount of Social Security Benefits: Married couples with Missouri adjusted gross income less than $100,000 and single individuals with Missouri adjusted gross income less than $85,000, may now deduct up to 100 percent of taxable social security and social security disability benefits.
Missouri Changes Taxable Amount of Military Pensions: For tax year 2014, the amount of military pension income that is excluded from Missouri state tax liability will increase from 60% to 75%.
Missouri Notice: Missouri Department of Revenue has added a tax calendar to their website for Missouri taxpayers. This calendar will show all relevant tax due dates for Missouri tax payers. To see the calendar, go to Missouri Department of Revenue @ http://dor.mo.gov/
Federal Tax Law News:
Premium Tax Credit and the Federal/State Exchange Litigation: Currently, three appellate courts have addressed the issue of whether the Premium Tax Credit component of the Affordable Care Act ("Obamacare") is available to taxpayers who purchased their policy through the Federal Marketplace and not a state marketplace. Two of the three have held that taxpayers who did purchase their coverage through the Federal Marketplace and not a state exchange are not eligible for the Premium Tax Credit. This is a developing story and will ultimately wind up before the Supreme Court. The case is interesting because the statutory language of the Affordable Care Act states that the Premium Tax Credit is available only to those individuals who purchase their insurance through a state operated exchange.
IRS Announces Increase in FICA Tax Ceiling: The IRS announced that the amount of income subject to FICA (Social Security and Medicaid) taxes has increased for 2015 from $117,000 to $118,500.
IRS To Permit Revocation of Election to Participate in a Cafeteria Plan: Under IRS Notice 2014-55, an employee may elect to revoke their election to participate in a employer sponsored heath care plan (commonly referred to as a Cafeteria Plan) in order for the employee to seek coverage through the Health Care Marketplace. Prior to this notice, an employee's election was irrevocable until the next enrollment period. Under IRS Notice 2014-55, an employee may now revoke his or her election and pursue coverage (along with the Premium Tax Credit) in the Marketplace.
Increase in Personal Exemption Amount: The Internal Revenue Service has announced that for tax year 2014, the amount an individual may deduct for their personal exemption has been increased to $3,950.
Taxpayer Bill of Rights: The Internal Revenue Service has recently issued IRS Publication 1: Taxpayer Bill of Rights. The Taxpayer Bill of Rights includes 10 provisions and states that a Taxpayer, when dealing with the Internal Revenue Service, has the following rights:
1.Right to be Informed 2.Right to Quality Service 3.Right to Pay No More than the Correct Amount of Tax 4.Right to Challenge the IRS Position and Be Heard 5.Right to Appeal and IRS Decision in an Independent Forum 6.Right to Finality 7.Right to Privacy 8.Right to Confidentiality 9.Right to Retain Representation
10. Right to a Fair and Just Tax System
For more information on the Taxpayer Bill of Rights, or if you have an outstanding IRS matter that needs professional advice, consult one of our highly trained tax preparers today.
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