Pet insurance doesn’t qualify for tax break

By JoyTaylor and Sandra Block

Kiplinger’s Personal Finance

Q: Myemployeroffers a pet insurance benefit. Can I pay for this with pretaxwages?

A: No. Unlike employer-paid health insurance forworkers, which isn’t included in taxablewages, the value of employer-paid pet insurance is taxable income. Most employerswhooffer pet insurance benefits don’t subsidize the cost, and employees whoopt in pay their share through posttax payroll deductions.

Q: Can I use 529 funds to pay fora college student’s studies abroad?

A: Inmany cases, yes. A529 plan can be used for any college that participates in theU.S. federal student aid program. If a student is enrolled in aU.S. college and chooses to study abroad through the school’s programfor a semester or two, the study-abroad programwill be 529-eligible, provided theU.S. college is eligible and the college accepts the study-abroad credits.

If the child decides to enroll in a non-U.S. college for their full college education, then that foreign university must participate in theU.S. federal student aid program. And, believe it or not, many foreign colleges do participate andwould therefore qualify as eligible schools for 529 purposes. Tuition, books, fees, and roomand board can be paid with 529 funds.

Q: I owna residential rental property and put a newroofon it last month. Can I fully deduct the cost of the roofon Schedule E ofmy2024 Form 1040?

A: No, but you can depreciate it over 27 ½

years. Thenewroof you installed is treated as an improvement to the rental property and is treated separately fromthe underlying property for depreciation purposes.

This means the roof’s cost is depreciated over 27 ½ years, the same as residential rental property. The beginning depreciation yearwould be 2024, the year you put on thenewroof.

Q: Howmuchtime do I have to fix a mistake on a tax return?

A: You generally have up to three years fromthe date you filed your original return (or two years fromthe date you paid any tax due) to file an amended return.

If you simply made amath error, the IRS will correct it. However, if you failed to report taxable income, which may occur if you overlooked a Form 1099 fromone of your brokerage accounts, you should file the amended return and pay the additional tax owed as soon as possible to reduce interest and potential penalties. If filing an amended return will increase the size of your refund, you should file as soon as possible to speed delivery of your payment. About 3 million taxpayers file amended returns each year, and the process has become easier since 2020, when the IRS began accepting electronic submissions of Form 1040X, the document used to amend a federal tax return. Previously, taxpayers had to file the form on paper.

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