The
Tax Increase Prevention Act of 2014 that
was signed last December mainly affected the year 2014 as it extended for that
year only some 50 tax breaks that had expired earlier. One provision, however,
became effective in 2015. Starting this year, the law authorizes tax-favored
ABLE accounts for disabled individuals. These "Achieving a Better Life
Experience" accounts are exempt from income tax when the funds are used to
pay for qualified expenses such as transportation, housing, education, and
medical costs. Nonqualified distributions are subject to income tax, plus a 10%
penalty. If you would like details about ABLE accounts, contact our office.
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