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Early planning can make 2012 filing season easier
The new year brings a new tax filing season. Mid-April may seem like a long time away in January but it is important to start preparing now for filing your 2011 federal income tax return. The IR...

Payroll tax cut extended two-months; other temporary incentives expire
As 2012 gets underway, Congress has extended the employee-side payroll tax cut but a laundry list of tax incentives have expired and their renewal is in doubt. The fate of these incentives, alon...

Looking back: Top 10 federal tax developments of 2011
Looking back over 2011, the IRS, Congress and the courts made many tax decisions impacting taxpayers of all types. Some tax developments were taxpayer-friendly; others imposed new requirements on taxp...

FAQ... When do I need to file IRS Form 8938, Statement of Specified Foreign Financial Assets?
The Foreign Account Tax Compliance Act (FATCA), enacted in 2010, requires certain U.S. taxpayers to report their interests in specified foreign financial assets. The reporting requirement may ap...

How do I...Claim a charitable contribution of property?
Claiming a charitable deduction for a cash contribution is straightforward. The taxpayer claims the amount paid, whether by cash, check, credit card or some other method, if the proper records are mai...

January 2012 tax compliance calendar
As an individual or business, it is your responsibility to be aware of and to meet your tax filing/reporting deadlines. This calendar summarizes important tax reporting and filing data for individuals...

FAQ: When is the best time of year to contribute to an IRA?
A: If you have the money, contributing to your IRA immediately on January 1st or as soon thereafter as possible is the best strategy. The #1 advantage of an IRA is that interest or other investment in...

How do I? Deduct a contribution of clothing or a household item under the new rules?
Every year, Americans donate billions of dollars to charity. Many donations are in cash. Others take the form of clothing and household items. With all this money involved, it's inevitable that some a...

How Do I? Predict whether I'll owe alternative minimum tax (AMT)
The AMT is difficult to apply and the exact computation is very complex. If you owed AMT last year and no unusual deduction or windfall had come your way that year, you're sufficiently at risk this y...

Client FAQ: Can I convert stock with paper losses into tax benefits?
Q. A promising investment opportunity proved too good to be true and I have incurred some stock losses. I still have faith in the company and don't want to abandon it but can I use some of these losse...

How Do I? Correct an excess contribution to an IRA
When trying to maximize retirement savings contributions, you may find you have contributed too much to your IRA. Typically, you either have too much income to qualify for a certain IRA or you can't ...

Tips for small business to maximize the new manufacturing deduction
Starting for tax year 2005, businesses have been able to take a new deduction based on income from manufacturing and certain services. Congress defined manufacturing broadly, so many businesses -just ...

FAQ: What if I receive an incorrect information return?
Information returns usually arrive in January or February and consist of either Form 1099 or Form 1098. For some, they seem as ubiquitous as their holiday mail in December. Form 1099s are especially l...

How do I -- Time a year-end bonus to be taxed next year?
Given a choice between recognizing income now or in a later year, most people want to be paid now and be taxed in a later year. As a practical matter, however, an employee cannot defer compensation af...

How do I: Calculate gain on the sale of collectibles?
You've just disposed of a collectible item (or your entire collection), such as an old coin, artwork, figurine, or even those old baseball cards you somehow managed to keep away from the spokes of you...

Education tax breaks can ease the financial pain of back-to-school
It's back-to-school time and many families are looking for ways to stretch their education dollars. To help, there are some generous tax breaks. Deductions and credits are available and while they won...

How do I? Make and compute a charitable contribution of inventory?
The Tax Code encourages charitable donations by businesses and industries. In fact, it is one tax incentive that President Bush has told his tax reform panel that he wants to preserve and strengthen. ...

Independent contractors can help limit your liability
One of the easiest ways for a business to limit liability is to use independent contractors instead of employees. Of course, merely calling employees "independent contractors" will not make those indi...

Personal holding company tax traps many unsuspecting businesses
The closely-held corporate form of entity is widely used by family-owned businesses. As its name implies, the owners of the business are typically limited to a small group of shareholders. Many busine...

FAQ: If I employ my 17-year old child, what withholding, etc. is required?
Whether a parent who employs his or her child in a family business must withhold FICA and pay FUTA taxes will depend on the age of the teenager, the amount of income the teenager earns and the type of...

Owning a vacation home raises important tax questions
Owning a vacation home is a common dream that many people share...a special place to get away from the weekday routine, relax and maybe, after you retire, a new place to call home....

FAQ: What must I report if I own assets abroad?
For U.S. taxpayers, owning assets held in foreign countries may have a variety of benefits, from ease of use for frequent travelers or those employed abroad to diversification of an investment portfol...

How do I...stop interest from running on a potential tax bill?
The federal government makes a lot of money from interest people owe on their taxes. Unless you are proactive, interest will accrue and before you know it, your original tax bill will be much higher. ...

How Do I? Comply with the tax laws on household help
If you pay for domestic-type services in your home, you may be considered a "domestic employer" for purposes of employment taxes. As a domestic employer, you in turn may be required to report, withhol...

FAQ: Are closing costs tax deductible when you refinance?
This is a simple question, but the question does not have a simple answer. Generally speaking the answer is no, closing costs are not deductible when refinancing. However, the answer depends on what y...

IRAs for offsprings: A head-start on a child's retirement
Parents typically encourage their children to save for college, for a house, or simply for a rainy day. A child's retirement, however, is a less common early savings goal. Too many other expenses a...

How Do I ? ... Report the value of "traded" property or services?
The bartering system is an ancient form of commerce that still thrives today. From livestock in exchange for grain, to legal advice in exchange for accounting services, money-less trades are stil...

Skyboxes and opera seats: business entertainment expense treatment
Entertaining business clients and employees at sports events or arts performances can be good for the bottom line; and tax deductible, too. Whether to maintain contacts with existing customers, woo ne...

FAQ: Does my company have to offer domestic partner benefits?
With the exception of some city ordinances, companies are not required to offer benefits to a domestic partner of an employee. One major change occurs on January 1, 2005 when California will start...

Tax penalties: How much can a mistake, or worse, cost?
You should beware of fancy footwork when it comes to estimating, filing, and paying federal taxes. One misstep can lead to harsh penalties. Willful or fraudulent mistakes can generate criminal sancti...

How do I? ...Set up a transportation benefit plan for my employees
Many employers opt to provide their employees with transportation benefits in addition to their regular compensation. Employers can offer this extra perk in the form of transportation passes, parking ...

FAQ: Must I retain original business expense receipts if I computer scan them?
No, taxpayers may destroy the original hardcopy of books and records and the original computerized records detailing the expenses of a business if they use an electronic storage system....

FAQ - Can I deduct the cost of foreign language study as a business expense?
The answer to this question would depend on a number of facts and circumstances. To be able to deduct work-related educational expenses as a business expense, you must: work as an employee or be se...

Employers must be up to date with new COBRA notification rules
The Consolidated Omnibus Budget Reconciliation Act (COBRA) requires employers to give former employees, spouses and children the opportunity to continue their group health coverage for 18 months an...

How do I?... Plan a picnic for my employees that is a tax-free benefit
Some gifts to employees are too insignificant for the IRS to care about. The IRS calls these gifts de minimis fringe benefits. A de minimis fringe benefit is any gift or service with a value so small ...

How do I…? Fulfill my federal withholding obligations for new employees
Hiring new employees imposes many burdens on an employer. One of the most important is the collection and filing of Form W-4, Employee's Withholding Allowance Certificate. Mistakes can be very co...

FAQ: What is a Spousal IRA?
If you file a joint return and your taxable income is less than that of your spouse, the "spousal" IRA rules may allow you to contribute up to $5,000 in 2009 (or $6,000 if you are 50 or older) to a...

Tax aspects of employee terminations shouldn't be ignored
Many tax issues arise when an employee leaves, or is terminated, from employment. How they are handled can make the difference between having an employee leave feeling more in control of the situa...

Estate planning tool: Qualified Personal Residence Trusts
In many parts of the country, residential property has seen steady and strong appreciation for some time now. In an estate planning context, however, increasing property values could mean a potent...

FAQ...Must I file a joint return if I'm married?
Just because you're married doesn't mean you have to file a joint return. This is a common misconception along with thinking that "married filing separately" applies to couples who are separated or se...

FAQ: Do we miss out on the homesale tax break if we move too often?
The IRS has some good news for you. Under new rules, you may be able to gain a partial tax break on the full $250,000 capital gain exclusion ($500,000 if you file jointly with your spouse), even if...

How do I?…Set up a SEP
As a business owner you have likely heard about the tax advantages of setting up a retirement plan for you and your employees. Many small business owners, however, have also heard some of the horr...

FAQ...What are the tax benefits from working in a foreign country?
U.S. citizens and resident aliens working abroad may exclude up to $91,400 of their foreign earned income for 2009. Additionally, expatriates may deduct or exclude their foreign housing costs in exces...

FAQ: The IRA that I converted to a Roth IRA has gone way down in value. Any tax relief available?
Q. I converted my regular IRA to a Roth IRA when the account had a high value because the stock market was at an all time high. I paid the required tax on the conversion when the conversion proce...

How do I...Obtain back tax returns or account information from the IRS?
A taxpayer who may have misplaced or lost a copy of his tax return that was already filed with the IRS or whose copy may have been destroyed in a fire, flood, or other disaster may need information...

FAQ: What expenses can I deduct when I do volunteer work for a charity?
Generally, if you do volunteer work for a charity, you are not entitled to deduct the cost of services you perform for the charity. However, if in connection with the volunteer work you incur out-o...

FAQ: What tax deductions am I entitled to as an investor?
Q: What tax deductions am I entitled to as an investor?A: Certain investment-related expenses are deductible, others are specifically restricted. Still othe...

How do I...Compute required distributions from my retirement accounts?
New IRS rules substantially simplify the computation of required minimum distributions (RMDs). In addition, Congress has forced the IRS to adopt new life expectancy tables that reflect longer life ex...

Making gifts to minors: How generosity can help ease your tax bill
Making gifts is a useful, and often overlooked, tax strategy. However, when thinking about whether to make a gift, or gifts, to your children or other minors, the tax consequences must be evaluated...

FAQ: When should I start worrying if my income tax refund check has not arrived yet?
No use worrying. More than five million people every year have problems getting their refund checks so your situation is not uncommon. Nevertheless, you should be aware of the rules, and the steps to ...

Estate planning for retirement plan assets
Throughout all of our lives, we have been told that if we don't want to work all of our life, we...

How do I? Compute my net worth
How much am I really worth? This is a question that has run through most of our minds at one time or another. However, if you aren't an accounta...

Provide for family members while achieving your giving goals with charitable lead trusts
In addition to direct giving during their lifetimes, many people look at how they can incorporate charitable giving in their estate plans. While many options are available, one plan that allows you...

Client FAQ - Gifts to employees
Q: The holidays are approaching and I would like to consider giving gifts of appreciation to my employees. What kinds of gifts can I give my employees that they would not have to decl...

Client FAQ: Tax-sheltered annuities
Q: When it comes to investing, I've always played pretty "mainstream" - investing in mutual funds and governments bonds. However, I've heard people talking about ...

Family matters: Is your second income worth the hassle?
Dual-income families are commonplace these days, however, some couples are discovering that their second income may not be worth the added aggravation and effort. After taking into consideration da...

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