Archive for March, 2011
Saturday, March 12th, 2011
Chris Blach, QuickBooks ProAdvisor |
 Filling out invoices the first time can be a pain, especially if they’re lengthy. But doing the same thing repeatedly if the identical invoice recurs regularly? No need.QuickBooks can memorize a variety of transaction types, including invoices, purchase orders, and bills. After you’ve memorized them, you can edit, reschedule, and delete them, as well as group them if more than one will be dispatched on the same day.Here’s how… (more…) |
Posted in Accounting, Quickbooks | No Comments »
Friday, March 11th, 2011
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| If you changed your name this year as a result of a recent marriage or divorce, you’ll want to take the necessary steps to ensure the name on your tax return matches the name registered with the Social Security Administration. A mismatch between the name shown on your tax return and the SSA records can cause problems in the processing of your tax return and may even delay your refund. (more…) |
Posted in Individual, Tax | No Comments »
Thursday, March 10th, 2011
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| Question: How do I know if I have to file quarterly individual estimated tax payments?
Answer: If you owed additional tax for the prior tax year, you may have to make estimated tax payments for the current tax year.
You must make estimated tax payments for the current tax year if both of the following apply: (more…) |
Posted in Individual, Tax | No Comments »
Wednesday, March 9th, 2011
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| Keeping full and accurate homeowner records is vital for determining not only your home deductions, but also the basis or adjusted basis of your home. These records include your purchase contract and settlement papers if you bought the property, or other objective evidence if you acquired it by gift, inheritance, or similar means.You should also keep any receipts, canceled checks, and similar evidence for improvements or other additions to the basis. Here’s some examples: (more…) |
Tags: homeowners
Posted in Individual, Tax | No Comments »
Tuesday, March 1st, 2011
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?by Martin C Lougen Jr., CPA, Partner ??  Under a new state law, homeowners who make more than $500,000 a year are no longer eligible for the basic STAR exemption tax break, worth an average of $500 off their property tax bill. Some towns have already sent out letters to local homeowners notifying them that their STAR exemption has been nullified, while other towns are still in the income verification process. In many instances, these letters have been the result of a faulty income verification process. If you receive this letter and believe it is an error, it is imperative that you act. (more…) |
Tags: homeowners, STAR exemption
Posted in Individual, Tax | No Comments »
Tuesday, March 1st, 2011
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College Planning
If you have young children, review their college planning. Determine the amount you will need to accumulate by the time they enter college. Based on this estimate, establish or review your savings plan. Consider one or more of the tax-favored higher education programs.
Mortgage Review
Review your home mortgage. Are you paying too much interest? Consider the savings you could obtain by refinancing. Also look into the possibility of making mortgage payments twice a month or adding some principal to each payment to save on the interest cost. If you have other debt at higher interest rates, and the interest is non-deductible, consider paying off these debts with a home equity loan.
Required Minimum Distribution
If you were age 70-1/2 last year and did not take the required minimum distribution from your retirement plans, prepare to take a withdrawal before April 1. Professional guidance will be helpful here.
Review Budget vs. Actuals
Compare February income and expenditures with your budget. Make adjustments as appropriate to your March expenditures. Make sure you have invested your planned savings amount for February.
Estimated Tax Payments
Total up your taxable income, capital gains, and deductions for the first quarter. This information can be used to plan your estimated tax payments and perhaps avoid or minimize any underpayment penalties. Let us know if you have questions about how to do this. |
Posted in General | No Comments »
Tuesday, March 1st, 2011
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| If you haven’t contributed funds to an Individual Retirement Arrangement for tax year 2010, or if you’ve put in less than the maximum allowed, you still have time to do so. You can contribute to either a traditional or Roth IRA until the April due date for filing your tax return for 2010, not including extensions.Be sure to tell the IRA trustee that the contribution is for 2010. Otherwise, the trustee may report the contribution as being for 2011 when they get your funds. (more…) |
Tags: retirement
Posted in Individual, Retirement, Tax | No Comments »
Tuesday, March 1st, 2011
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Got kids? They may have an impact on your tax situation. Here are the top 8 things to consider if you have children.
- Dependents: In most cases, a child can be claimed as a dependent in the year they were born. Be sure to let us know if your family increased this year and we’ll take a look at whether you can claim the child as a dependent this year.
- Child Tax Credit: You may be able to take this credit on your tax return for each of your children under age 17. If you do not benefit from the full amount of the Child Tax Credit, you may be eligible for the Additional Child Tax Credit. The Additional Child Tax Credit is a refundable credit and may give you a refund even if you do not owe any tax.
- Child and Dependent Care Credit: You may be able to claim this credit if you pay someone to care for your child under age 13 so that you can work or look for work. Be sure to keep track of your child care expenses so we can claim this credit accurately.
- Earned Income Tax Credit: The EITC is a benefit for certain people who work and have earned income from wages, self-employment, or farming. EITC reduces the amount of tax you owe and may also give you a refund.
- Adoption Credit: You may be able to take a tax credit for qualifying expenses paid to adopt a child.
- Coverdell Education Savings Account: This savings account is used to pay qualified expenses at an eligible educational institution. Contributions are not deductible; however, qualified distributions generally are tax-free.
- Higher Education Credits: Education tax credits can help offset the costs of education. The American Opportunity and the Lifetime Learning Credit are education credits that reduce your federal income tax dollar for dollar, unlike a deduction, which reduces your taxable income.
- Student Loan Interest: You may be able to deduct interest you pay on a qualified student loan. The deduction is claimed as an adjustment to income so you do not need to itemize your deductions.
As you can see, having children can make a big impact on your tax profile. If you’re a parent, we’ll go over your situation with you to make sure you’re getting the appropriate credits and deductions. |
Tags: children
Posted in Individual, Tax | No Comments »
Tuesday, March 1st, 2011
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If you use a car for business, you get the benefit of tax deductions.There are two choices for claiming deductions:
- Deduct the actual business-related costs of gas, oil, lubrication, repairs, tires, supplies, parking, tolls, drivers’ salaries, and depreciation.
- Use the standard mileage deduction and simply multiply 51 cents for 2011 travel (2010′s rate was 50 cents) by the number of business miles traveled during the year. Your actual parking fees and tolls are separately deductible under this method.
Which Method Is Better?
For some taxpayers, the standard mileage rate produces a larger deduction. Others fare better tax-wise by deducting actual expenses.
Tip: The actual cost method allows you to claim accelerated depreciation on your car, subject to limits and restrictions not discussed here.
The standard mileage amount includes an allowance for depreciation. If we opt for the standard mileage method, it allows you to bypass the limits and restrictions and it’s simpler – but it’s often less advantageous in dollar terms.
Caution: The standard rate may understate your costs, especially if you use the car 100% for business, or close to that percentage.
Generally, the standard mileage method benefits taxpayers who have less expensive cars or who travel a large number of business miles.
How to Make Tax Time Easier
Keep careful records of your travel expenses. We won’t be able to determine which of the two options is better for you if you don’t know the number of miles driven and the total amount you spent on the car.
Furthermore, the tax law requires that you keep travel expense records and that you give information on your return showing business versus personal use. If we use the actual cost method for your auto deductions, you must keep receipts.
Tip: Consider using a separate credit card for business, to simplify your recordkeeping.
Tip: You can also deduct the interest you pay to finance a business-use car if you’re self-employed.
Note: Self-employeds and employees who use their cars for business can deduct auto expenses if they either (1) don’t get reimbursed, or (2) are reimbursed under an employer’s “non-accountable” reimbursement plan. In the case of employees, expenses are deductible to the extent that auto expenses (together with other “miscellaneous itemized deductions”) exceed 2% of adjusted gross income.
We will help you determine the best deduction method for your business-use car. Let us know if you have any questions about which records to keep. |
Tags: automobile deductions
Posted in Business, Tax | No Comments »
Tuesday, March 1st, 2011
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| March 10
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Employees who work for tips – If you received $20 or more in tips during February, report them to your employer. You can use Form 4070.
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| March 15
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Employers – Nonpayroll withholding. If the monthly deposit rule applies, deposit the tax for payments in February.
Employers – Social Security, Medicare, and withheld income tax. If the monthly deposit rule applies, deposit the tax for payments in February.
Corporations – File a 2010 calendar year income tax return (Form 1120 or 1120-A) and pay any tax due. If you want an automatic 6-month extension of time to file the return, file Form 7004 and deposit what you estimate you owe.
S Corporations – File a 2010 calendar year income tax return (Form 1120S) and pay any tax due. Provide each shareholder with a copy of Schedule K-1 (Form 1120S), Shareholder’s Share of Income, Credits, Deductions, etc., or a substitute Schedule K-1. If you want an automatic 6-month extension of time to file the return, file Form 7004 and deposit what you estimate you owe.
Electing large partnerships – Provide each partner with a copy of Schedule K-1 (Form 1065-B), Partner’s Share of Income (Loss) From an Electing Large Partnership. This due date is effective for the first March 15 following the close of the partnership’s tax year. The due date of March 15 applies even if the partnership requests an extension of time to file the Form 1065-B by filing Form 8736 or Form 8800.
S Corporation Election – File Form 2553, Election by a Small Business Corporation, to choose to be treated as an S corporation beginning with calendar year 2011. If Form 2553 is filed late, S treatment will begin with calendar year 2012.
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| March 31
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For information about filing Forms 1098, 1099, or W-2G electronically, see Publication 1220, Specifications for Filing Forms 1098, 1099, 5498 and W-2G Magnetically or Electronically.
Electronic filing of Forms W-2: File copies of all the Forms W-2 you issued for 2010. This due date applies only if you electronically file. The due date for giving the recipient these forms remains at January 31.
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Posted in Federal Tax Due Dates | No Comments »
Filling out invoices the first time can be a pain, especially if they’re lengthy. But doing the same thing repeatedly if the identical invoice recurs regularly? No need.QuickBooks can memorize a variety of transaction types, including invoices, purchase orders, and bills. After you’ve memorized them, you can edit, reschedule, and delete them, as well as group them if more than one will be dispatched on the same day.Here’s how… (more…)
Under a new state law, homeowners who make more than $500,000 a year are no longer eligible for the basic STAR exemption tax break, worth an average of $500 off their property tax bill. Some towns have already sent out letters to local homeowners notifying them that their STAR exemption has been nullified, while other towns are still in the income verification process. In many instances, these letters have been the result of a faulty income verification process. If you receive this letter and believe it is an error, it is imperative that you act. (more…)
