Although the tuition and fees deduction expired, there will still be other education-related tax breaks available for students and their parents during the 2014 tax year, including a deduction for interest paid on student loans and the American Opportunity and lifetime learning credits.
—Unless Congress acts, elementary, middle school and high school teachers will no longer be able to take a $250 deduction for school supplies paid out of pocket. According to CRS, this deduction has been on the books since 2002.
STATE AND LOCAL SALES TAX
Taxpayers had temporarily been given the choice of deducting state and local sales taxes instead of state and local income taxes. This had been particularly beneficial for taxpayers who lived in states like Florida, Nevada and Texas without an income tax, and for those who made a purchase significant in value.
"Folks aren't going to see it anymore," said Craig Richards, managing partner and director of tax services at Fiduciary Trust.
In an attempt to help people who lost their homes during the housing crisis or who owed more on the home than its value, Congress had passed legislation that allowed homeowners to exclude up to $2 million in mortgage forgiveness from taxable income. That tax break was not extended beyond 2013.
Nina Olson, the national taxpayer advocate, says there's an important exception — taxpayer insolvency. If the taxpayer is insolvent — defined on the taxpayer advocate's website as "when a taxpayer's total debt exceeds his or her total assets" — the mortgage writeoff would not be considered taxable income, she said
In another change affecting housing, Congress let the deduction for the cost of premiums for home mortgage insurance expire.
Taxpayers older than 70½ no longer have the option of contributing to charities directly from their individual retirement accounts. This direct contribution allowed seniors to avoid having to declare the amount withdrawn from the IRA as income — and pay taxes on it.