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Tax Alert: “Fiscal Cliff” Legislation Extends Key Tax Incentives Through 2013




The Fiscal Cliff has been averted with President Obama signing the American Taxpayer Relief Act of 2012 (H.R. 8) into law on January 2, 2013. As a NJ CPA and NY CPA firm, we are happy to share this information with you.  The bill extends many long-awaited business tax extenders – many of which originally expired at the end of 2011. Many of the incentives are temporary so taxpayers should act quickly to take advantage of them, especially given the rise in rates for certain taxpayers. Some of the key tax benefits include:

  • R&D Tax Credit Extended – Research credits for qualified research activities have been extended for 2 years through the end of 2013. For some fiscal year-end taxpayers, the retroactive extension will provide an opportunity to amend their 2011 returns in order to claim those qualified expenditures which occurred in 2012.
  • §179 Expensing Thresholds & 50% Bonus Depreciation Extended – Section 179’s increased expensing amounts have been extended through 2013. 50% Bonus Depreciation provisions have been extended through the end of 2013 as well (2014 for certain property).
  • 15-Year Life for Qualified Real Property – 2-year extension allows for qualified leasehold improvement property, qualified restaurant property, and qualified retail improvement property to have a 15-year depreciation recovery period through the end of 2013.
  • §45L Energy Efficiency Credits for Multifamily & Residential Developers – 2-year extension allows Apartment developers and Homebuilders to be eligible for a $2,000 tax credit for every new energy efficient dwelling unit that is leased or sold by the end of 2013.  Taxpayers also have the ability to amend returns to claim missed tax credits from previous years.

Hiring & Employment Credits Extended – Work Opportunity Tax Credits and Empowerment Zone Tax Incentives have been extended through the end of 2013.

For assistance in this matter or another tax or accounting matter, from a New Jersey accountant, or from a New York accountant, please contact us at 201-947-8081 or 646-688-2807, or email us at




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