Archive for November, 2012

Fiscal Cliff Tax Planning

November 30th, 2012 No comments

What is the fiscal cliff? From a tax perspective, it is the expiration of more than 50 temporary tax provisions (extenders), the expiration of the Bush 2001/2003 tax cuts, the expiration of the payroll tax cut, and the expiration Read more…


Child Care Tax Considerations

November 27th, 2012 No comments

A taxpayer can claim a nonrefundable child and dependent care tax credit if someone is paid by the taxpayer to watch his under-age-13 dependent child or children (who are eligible to be claimed as dependents of the taxpayer) so that the taxpayer Read more…


Form W-2 Reporting of Employer-Sponsored Health Care

November 20th, 2012 No comments

Employees may be surprised to a new item reported on their 2012 W-2s. Beginning with the issuance of 2012 W-2s, the employer is required to report the value of health care coverage Read more…


Vehicle Depreciation and Deductions

November 12th, 2012 No comments

If you use your vehicle in pursuit of a trade or business, you may be allowed to deduct the ordinary and necessary expenses incurred while operating the vehicle. However, any expenses associated with the personal use of the vehicle are not deductible.

Personal vs. business miles. Business use of your car can include traveling from one work location to another work location within your tax home area; visiting customers; attending a business meeting away from the regular workplace; traveling to the bank for making daily deposits of cash; going to the post office if business related; and traveling from home to a temporary workplace if you have one or more regular places of work. The costs of travel between home and a regular place of work, however, are nondeductible commuting expenses.

Standard mileage rate vs. actual cost method. In lieu of proving the actual costs of operating an automobile owned by them, employees and self-employed individuals may compute the deductible costs for their business use of an auto using a standard mileage rate. The 2012 standard mileage rate is Read more…



November 9th, 2012 No comments

The IRS is warning taxpayers about scams that involve websites that mimic the IRS e-Services online registration page. Apparently, taxpayers are being contacted and told to register on the IRS e-Services online registration page. The address of the official IRS website is Don’t be mislead by sites claiming to be the official IRS website and ending Read more…



November 5th, 2012 No comments

There are numerous tax law changes to occur beginning January 1, 2013 (assuming that Congress and the White House cannot agree to extend these tax provisions). While the items below are not all-inclusive, they are items that will affect many taxpayers and are all part of the falling off of the fiscal cliff scenario being discussed.

  • Annual gift tax exclusion will increase from $13,000 to $14,000
  • The amount used  to reduce the net unearned income reported on a child’s tax return to calculate the Kiddie tax  increases from $950 to $1,000
  • The elective contribution limit for employees who participate in Sec. 401(k), 403(b) or 457(b) plans increases from $17,000 Read more…

IRS Accepting More Offers-in-Compromise?

November 2nd, 2012 No comments

Do you owe the IRS significant amounts for back taxes, are subject to wage garnishments or bank levies? Depending upon your financial situation, you may be a candidate for an offer-in-compromise (OIC).  An OIC is an IRS program where, if the taxpayer meets certain IRS financial standards, the IRS will accept less money than the full amount due the IRS as a compromise.

According to Scott Reisher, Director, Collection Policy of the IRS Small Business/Self-Employed Division, the IRS is accepting more OICs from taxpayers who cannot pay the full amount of their back taxes. The IRS accepted 27% of OICs made in 2010 and 34% of the OICs made in 2011. Reisher, speaking on a webcast for the American Bar Association Section of Taxation, stated that most OIC cases are resolved within nine months.

While the percentage of OICs accepted by the IRS is statistically known, what is not known Read more…

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