It’s that time of year … time to pull together all your interest, dividend, retirement, investment, and any other documents you may need to prepare your taxes.
The big news for taxes this year is that due to the South Carolina floods and disasters, both the Federal and South Carolina deadlines have been extended to May 1, 2025.
Federal Return
If you have made home improvements, you may be eligible for Residential Energy Improvement credits. Improvements include windows, doors, heat pumps, solar, geothermal, and others. New for this year, you may also receive a credit if you have had a Home Energy Audit conducted in 2024. Improvements do not include maintenance and repair.
If you have excess, unused funds in a 529 Plan (Educational Savings Plan), you can now roll over unused funds into a Roth IRA. There are rules and annual and lifetime limits so it would be wise to talk with a tax professional before taking this action.
As in previous years, you can send some or all of your Required Minimum Distribution (RMD) from tax-deferred accounts to a non-profit charitable organization as a donation. The result of this action is that:
- you won’t have to pay income tax on the charitable payout even if you don’t itemize.
- you will be providing a donation to help an organization that could use that money towards their mission.
If you decide to make this donation, the distribution needs to go directly from your brokerage account to the charitable organization, and you need to keep records of it. It may not appear on your 1099 form next year.
Click Continue reading to learn about South Carolina.
South Carolina
South Carolina taxes have not changed much for 2024 from 2023. As previously, SC residents over the age of 65 may deduct up to $15,000 of income and 100% of military retirement pay is exempt from SC individual tax.
There are many generous credits available, including contributions to the Future Scholar 529 Program, a Homestead Exemption after you have lived here a year if you are over 65, and an Excess Insurance Premium Credit, which is very helpful since we pay high home insurance premiums. Qualified insurance premiums include homeowners, flood, and wind, and hail insurance.
Click here for more information about South Carolina credits.
-Submitted by Barbara Erlandson, VITA Volunteer*
(*VITA (Volunteers Income Tax Assistance) is an IRS program that provides tax preparation help, free of charge, with a special focus on low to moderate-income taxpayers 50 years old and older. Click here to see how you can volunteer next year.)
(Image credit: iStock)