PATH Act Delays Refunds for Early Filers and Imposes Penalties for Fraud
PATH Act Expands and Makes Permanent Key Tax Benefits Including Education Credits
According to The Street, the Protecting Americans from Tax Hikes (PATH) Act of 2015 made important changes to tax rules. It requires refunds for early filers claiming the Additional Child Tax Credit (ACTC) or Earned Income Tax Credit (EITC) to be delayed until at least February 15. This delay gives the IRS extra time to verify claims and prevent fraud. The PATH Act also imposed strict penalties for those who fraudulently claim these credits which could prevent them from receiving these benefits for up to 10 years.
The Protecting Americans from Tax Hikes Act has made several tax benefits either permanent or more accessible. One such benefit is the improved Additional Child Tax Credit which now has a lower income threshold making it easier for more families to claim. Also the American Opportunity Tax Credit, which provides up to $2,500 for higher education expenses was made permanent. Furthermore the PATH Act expanded the use of 529 plan funds allowing them to cover expenses such as computers and internet access for students. The act also permanently extended the educator expense deduction and increased the Earned Income Tax Credit for families with three or more children.
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$3 Trillion in Tax Benefits: How the PATH Act Revolutionized Tax Policy for Americans-Check it out! (PHOTO: Spireon.com)
PATH Act Extends Tax Credits and Deductions for Electric Vehicles Mass Transit and Charitable Contributions
The PATH Act also introduced or extended several other tax benefits. It extended the tax credit for electric vehicle charging equipment and increased the exclusion for mass transit benefits. The act made mortgage debt forgiveness tax-free and allowed seniors to make tax-free charitable donations from their IRAs. Additionally it made the deduction for state and local sales taxes permanent. These changes aim to offer more stability and savings for taxpayers while strengthening the overall integrity of the tax system.
