When is the tax return due date?

Extended due date this year. Because of the Emancipation Day holiday in the District of Columbia, the due date of Form 1040 for 2010 is Apr. 18, 2011, instead of Apr. 15, 2011. The Apr. 18 due date applies even for taxpayers who do not live in the District of Columbia.

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Deduction allowed

Repairs to your personal residence incurred because of corrosive drywall can be deductible.  However, there is a catch as to when they were installed.   Source IRS.

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Payroll Deductions...

The 2010 Tax Relief Act reduces the employee OASDI tax rate under the FICA tax by two percentage points to 4.2%. The self-employment income is reduced by two percentage points to 10.4% percent.  Thus, you should see an increase in your paycheck and a reduction in your deductions in 2011.   The limit remains at $106,800.   Source IRS 

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Gift Card received during X-mass...is it reportable income or not?

A new revenue procedure allows a taxpayer to defer recognizing in gross income advance payments received from the sale of gift cards that are redeemable for goods or services of the taxpayer or a third party.   Excerts from the IRS.

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Reporting requirement- Recipients of Rental Income

Recipients of rental income from real estate generally are subject to the same information reporting requirements as taxpayers engaged in a trade or business. In particular, rental income recipients making payments of $600 or more during the tax year to a service provider (such as a plumber, painter, or accountant) in the course of earning rental income are required to provide an information return (typically Form 1099-MISC) to IRS and to the service provider.

Source IRS




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Retainer workers credit- in 2011

Up-to-$1,000 credit for “retained workers” in 2011. For any tax year ending after Mar. 18, 2010, Sec. 102 of the Hiring Incentives to Restore Employment Act provides an up-to-$1,000 increase (retention credit) to the general business credit for “retained workers.”

Source IRS

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What's New for 2011

Brief Summary of Few:

• Medicare Part D coverage gap rebate is not taxable.
• Qualifying parking max deduction is $230/month-same amount for employer provided transit.
• 2010-Start-up cost can be deducted raised to $10, 000.
• Standard milage rate for business is 50 cents.

Source IRS

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Tax Return preparation can have a hiden cost...

Sometimes is better to hire a professional for some work; for example doing your tax return.  Go to the link and read some stories. 

http://www.toddtax.com/rscs_imgs/self_prep.pdf



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General Business Credits

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General business credits of eligible small businesses for 2010 carried back 5 years

 

The new law allows an eligible small business to carry back general business credits five years. Previously, the credits could only be carried back one year. The carryback is for credits determined in the first taxable year beginning after December 31, 2009.

An “eligible small business” in general is defined as follows:

• A corporation whose stock is not publicly traded, a partnership, or a sole proprietorship, and
• The taxpayer must have $50,000,000 or less in average annual gross receipts over the three preceding tax years.

Source IRS 

Adoption Credit

The Affordable Care Act raises the maximum adoption credit to $13,170 per child, up from $12,150 in 2009. It also makes the credit refundable, meaning that eligible taxpayers can get it even if they owe no tax for that year. In general, the credit is based on the reasonable and necessary expenses related to a legal adoption, including adoption fees, court costs, attorney’s fees and travel expenses. Income limits and other special rules apply. In addition to filling out Form 8839, Qualified Adoption Expenses, eligible taxpayers must include with their 2010 tax returns one or more adoption-related

documents.  Source: IRS.gov

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