2015 Tax Bites
2015 Tax Bites ›› Here are a few bite-sized tax planning tips to consider
1. Don't forget to get your annual estate plan checkup.
An annual estate plan checkup is critical to the health of your estate plan. Because various exclusion, exemption and deduction amounts are adjusted for inflation, they can change from year to year, impacting your plan:
Lifetime Gift and estate tax exemption
2014 - $5.34 million | 2015: $5.43 million
Generation-skipping transfer tax exemption
2014 - $5.34 million | 2015: $5.43 million
Annual gift tax exclusion
2014 - $14,000 | 2015 - $14,000
Marital deduction for gifts to noncitizen spouse
2014 - $145,000 | 2015 - $147,000
2. Refund Turnaround & Wait Times
With filing season well underway the IRS highlighted the Affordable Care Act healthcare provisions included in the 2014 individual income tax return. The IRS expects more than four out of five returns will be filed electronically. They began accepting and processing all tax returns on 1/20/15. The fastest way to obtain a refund is to e-file choosing direct deposit. Similar to last year, the IRS expects to issue 90% of these refunds within 21 days. Due to budget cuts paper returns are expected to take an additional week or more to process, and refunds are expected to be issued in seven weeks or more. Commissioner Koskinen strongly encourages taxpayers to visit www.irs.gov before calling as phone wait times are routinely topping 30 minutes.
3. Fewer IRS Audits Predicted This Year.
In an email to employees, IRS Commissioner John Koskinen said the IRS will not be able to close as many audits in 2015 due to the agency's budget cuts. With a reduction in enforcement personnel (they announced a hiring freeze in December), he indicated that there will likely be at least 46,000 fewer individual and business audit closures and more than 280,000 fewer collections from automated notices or field revenue agents. Additionally, two furlough days for IRS employees in 2015 may be planned. Furthermore, aging information technology systems will not be replaced, which could delay new taxpayer protections against identity theft. This announcement comes on the heels of a budget reduction for the agency of $346 million during the remaining nine months of the fiscal year ending 9/30/15, which, according to the Commissioner, is the lowest funding since 2008.
Contact Kevin Rose, Susan Polcari, or any of your trusted advisors at HHM, today if you have any questions regarding this information.