The North Carolina General Assembly will review potential changes to North Carolina income tax laws on January 28, 2015. Filers should wait until after this date to submit their tax returns to prevent potentially refiling returns if tax changes are passed.
The Tax Increase Prevention Act of 2014
was signed by President Obama on December 19, 2014. This offered many last-minute tax advantages; our Chapel Hill tax attorneys reviewed those federal tax benefits
here. North Carolina law references prior federal tax laws and lawmakers need to decide if they will revise the references. If the General Assembly updates the code to reflect the new provisions, North Carolina income tax adjustments will be affected.
If passed to reflect the new tax act, the North Carolina tax laws would affect:
North Carolina individual income tax:
Amounts paid for mortgage insurance premiums from the deduction for qualified residence interest if the taxpayer claims itemized deductions on the North Carolina return
Amount excluded from gross income for the discharge of qualified principal residence indebtedness
Deductions for qualified tuition and related expenses affecting adjusted gross income
Charitable distribution deductions excluded from gross made from an individual retirement plan by a person aged 70 ½ or older
Although it is not necessary, the state is encouraging tax filers to consider delaying tax filing until the General Assembly decides if the tax code changes will occur. Time-intensive corrections and re-filing can be avoided if you wait to file and review returns with a tax professional to ensure accuracy.