Miles driven for business during the first six months of 2011 is 51 cents per mile and 55.5 cents for the second half of the year. Miles driven for medical reasons or moving is 19 cents per mile. Miles driven to provide services to charitable organizations is 14 cents per mile.
To get your reund fast and without any additional fees:
1. Make sure your name and your dependents names are correct in your return.
2. E- file your tax return.
3. Ask for direct deposit of your refund check into your bank account.
To check the status of your refund go to:
Scholarships received by a student toward a degreed education is tax free for qualified expenses such as tuition, fees, books, supplies and equipment. The room and board and travelling expenses are taxable and should be included in the 1040 tax return. The scholarships received for a non-degreed education is all taxable. For more information please refer to IRS publication 970.
Yes, you are better off to file your business tax return on time even though you can’t pay your taxes due. You pay less in penalties if you file your taxes on time. The penalty of late filing will be added to the penalty of late payment of taxes and you end up paying more out of your pocket.
The pass-through companies such as LLC’s, S Corporations are penalized for late filing by IRS and if in California by the State.
The extension dead-line for the LLC and S Corporations is September 15th.
The extension dead-line for Individual tax return is October 15th.
Remember your child has to be 13 or younger. Overnight camps expenses are not eligible for this credit. The cost of babysitters at home or a home facility is eligible too.
Enjoy the summer and let your kids enjoy themselves too.
Workers born in 1943 to 1954 can retire with full benefits at the age of 66 years. Workers born in 1960 and after have to wait until they are 67 years old. You may request to receive your benefits at age 62. However, your benefit will be reduced by almost 20%.
If you retire at your normal retirement age, i.e. 66 and start getting your full benefits and then go back work, you will not be subject to the social security test for working seniors between the age of 65 and 69. This test was eliminated in January 1, 2000.
However, you are subject to withholding for social security and medicare taxes on your wages. Social security benefits may become taxable if the retiree has other income besides his social security benefit. Please go to mztaxservice.com and click on Tax Info page to go to the IRS site for more information or contact us for any questions you may have.
You can contribute to the 529 College Savings plan account of your grandchild or any other beneficiary up to $13,000 per year. This contribution is considered a gift and it will also reduce your taxable income. The good thing is that this contribution does not reduce your federal and estate tax exemption ($5.12 million for 2012). You can actually pay more by electing a five- year spread. This election will let you contribute up to $130,000 (Married status) as lump-sum to your grandchild 529 account. You just need to file IRS Form 709 (Federal gift tax return form). Your money will grow tax free in this account and your grandchild can withdraw the money later on for higher education expenses tax free.
If you change your mind, you can always reverse your decision and withdraw all or part of the money from the 529 account. You just have to pay the taxes on the earning withdrawals and a 10% penalty on the earnings.
1.Review your paycheck and change your payroll taxes on your payroll check. If you had a good refund in your 2011 tax return, you may increase your exemptions. Ask your payroll administrator to give you a new W-4 and increase your exemptions. This way, you will be taking home more money through out the year instead of getting your refund all at once.
2. If you owed taxes, decrease your exemptions on the W-4 form. You will have a smaller paycheck but no surprises at the end of year with taxes due to pay.
3. Store your Tax Return and all your tax documents in a safe place. Keep your current tax documents for 2012 in one folder and make sure everybody in your family does the same. This will save you a lot of time for your next tax return filing.
4. Contact your tax professional before the end of the year and ask questions. Learn about the itemized deductions and try to plan ahead for 2012. Sometimes, you may be able to pay both portions of your property taxes in the same year and use that deduction for that year.
5. The American Opportunity Tax Credit, which offsets higher education expenses, is set to expire after 2012. It may be beneficial to pay 2013 tuition in 2012 to take full advantage of this tax credit, up to $2,500, before it expires. For more information, see IRS Publication 970, Tax Benefits for Education.
1. The credit is against employer’s share of social security tax.
2. The credit can be as high as $9600 per qualified veteran.
3. The amount of credit depends on how long the veteran had been unemployed before hiring, number of hours working and his first year wages.
4. Employer has to fill out form 8850 for Pre-Screening Notice and Certification Request to secure a certification 28 days after hiring the eligible veteran.
You might be eligible for a child tax credit. This credit is up $1000 per each eligible child. There are seven qualifying tests that have to be met according to IRS.
Married Taxpayers return $110,000
Married filing separate $55,000
Other taxpayers $75,000
This credit is generally limited by the amount of tax you owe.