Jan 31 2011
To make tax preparation a little easier for our clients, we have placed some popular forms on our website. Our clients who are daycare providers will find the Day Care Income and Expense Worksheet invaluable for recording their business expenses for the year.
Jan 28 2011
The Tax Relief Act contains a trove of tax breaks for businesses. The bill OKs the following major new incentives for businesses to invest in machinery and equipment:
1. A 100% bonus first-year depreciation allowance for property acquired and placed in service after Sept. 8, 2010, and before Jan. 1, 2012;
2. A 50% bonus first-year depreciation allowance for property placed in service after Dec. 31, 2011 and before Jan. 1, 2013;
3. Extension through Dec. 31, 2012, of the election to accelerate the AMT credit instead of claiming additional first year depreciation; and
4. For tax years beginning after Dec. 31, 2011, setting the maximum expensing amount under Sec. 179 at $125,000 and the investment-based phaseout amount at $500,000 (under current law, the expensing figures drop from $500,000/$2 million for 2010 and 2011 to $25,000/$200,000 after 2011).
Talk to us about your plans for investing in business machinery and equipment.
© 2010 Thomson Reuters/RIA. All rights reserved.
Jan 26 2011
On December 9, Senate Majority Leader Harry Reid (D-NV) introduced H.R. 4853, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the Tax Relief Act). The Tax Relief Act contains a two-year extension of the Bush-era tax cuts that was negotiated by the President and Republicans, and significant estate tax relief. However, it also contains a trove of other tax breaks for businesses and individuals. One area of tax-cuts returning under this agreement applies to estate taxes.
The estate tax returns after 2010 and before 2012, but with the following changes:
· A $5 million unified and indexed exemption amount ($10million for couples).
· The top tax rate will be 35% for estate, gift, and generation skipping transfer taxes.
· Reunification of estate and gift taxes, effective for gifts made after December 31, 2010.
· An election will allow the choice of no estate tax and modified carryover basis for estates arising on or after Jan. 1, 2010 and before Jan. 1, 2011. There will be a $5 million generation-skipping transfer tax exemption and zero percent rate for the 2010 year.
· Effective for estates of decedents dying after Dec. 31, 2010, the executor of a deceased spouse’s estate will be able to transfer any unused exemption to the surviving spouse.
We would be happy to answer any questions you may have about estate taxes.
© 2010 Thomson Reuters/RIA. All rights reserved.
Jan 24 2011
As a service to our clients, we have placed some highly used tax forms on our website. The 1040 worksheet will help you organize your financial information needed to accurately complete your Federal 1040.
Jan 21 2011
The Tax Relief Act contains a trove of other tax breaks for businesses and individuals. One area of the tax-cut rules to be extended regards the Alternative Minimum Tax (AMT).
The AMT exemption amounts for 2010 will be $47,450 for individuals and $72,450 for married taxpayers filing jointly; for 2011, they will be $48,450 for individuals and $74,450 for married taxpayers filing jointly. The exemption amount for marrieds filing separately is half the amount for joint filers. (Without the “patch,” AMT exemption amounts would have plummeted to their pre-EGTRRA levels.) Also for 2010 and 2011, personal credits will be allowed against the AMT.
Please contact us with any questions you may have on AMT.
© 2010 Thomson Reuters/RIA. All rights reserved.
Jan 19 2011
On December 9, Senate Majority Leader Harry Reid (D-NV) introduced H.R. 4853, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the Tax Relief Act). The Tax Relief Act contains a two-year extension of the Bush-era tax cuts that was negotiated by the President and Republicans, and significant estate tax relief. However, it also contains a trove of other tax breaks for businesses and individuals. One area of the tax-cut rules to be extended are those under EDTRRA.
Under current law, the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA, PL 107-16), other than those made permanent or extended by subsequent legislation, sunset and won’t apply to tax or limitation years beginning after 2010. (Sec. 901 of EGTRRA) H.R. 4853 would postpone the Sec. 901 EGTRRA sunset rule for two years. That is, under the Tax Relief Act, the provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA, PL 107-16), other than those made permanent or extended by subsequent legislation, will sunset and will not apply to tax or limitation years beginning after 2012 (instead of 2010). Thus, all of the following favorable tax rules (among others) will remain in place through 2012:
(1) The income tax rates for individuals stay at 10%, 15%, 25%, 28%, 33% and 35% (instead of moving to 15%, 28%, 31%, 36% and 39.6%).
(2) The size of the 15% tax bracket for joint filers & qualified surviving spouses remains at 200% (instead of dropping to 167%) of the 15% tax bracket for individual filers.
(3) The standard deduction for married taxpayers filing jointly (and qualified surviving spouses) remains at 200% (rather than 167%) of the standard deduction for single taxpayers. (The standard deduction for marrieds filing separately is half the joint filer amount.)
(4) Itemized deductions of higher-income taxpayers are not reduced (after 2010 they would have been reduced by 3% of AGI above an inflation-adjusted figure, but reduction couldn’t exceed 80%).
(5) A higher-income taxpayer’s personal exemptions are not phased out when AGI exceeds an inflation-adjusted threshold (they would have been after 2010).
The current, favorable rules for the following tax provisions also will remain in place through 2012: Coverdell Education Saving Accounts (CESAs), formerly called education IRAs; exclusion for employer provided educational assistance under Code Sec. 127; exemption from the payments-for-services rule for amounts received under certain Government health professions scholarship programs; above-the-line student loan interest deduction; credit for employer-provided child care facilities; earned income tax credit (EITC); credit for household and dependent care; and child tax credit.
If you have any questions on the implications of these tax rules, give us a call.
© 2010 Thomson Reuters/RIA. All rights reserved.
Jan 17 2011
The Tax Relief Act contains a trove of other tax breaks for businesses and individuals. One area of the tax-cut rules to be extended are those under JGTRRA.
The bill defers for two years the sunset rule of Sec. 303 of the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA, PL 108-27). Thus, through Dec. 31, 2012, long-term capital gain will continue to be taxed at a maximum rate of 15% (instead of 20% (18% for assets held more than five years)); and qualified dividends paid to individuals will be taxed at the same rates as long-term capital gains (instead of being taxed at the same rates that apply to ordinary income).
If you have any questions about the JGTRRA rules, give us a call.
© 2010 Thomson Reuters/RIA. All rights reserved
Jan 14 2011
Congress passed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 on December 16, 2010 and President Barack Obama signed it into law on December 17, 2010. This sweeping tax package includes, among many other items, an extension of the Bush-era tax cuts for two years, estate tax relief, a two-year “patch” of the alternative minimum tax (AMT), a two-percentage-point cut in employee-paid payroll taxes and in self-employment tax for 2011, new incentives to invest in machinery and equipment, and a host of retroactively resuscitated and extended tax breaks for individuals and businesses.
Key elements of the package include:
• Current income tax rates will be retained for two years (2011 and 2012), with a top tax of 35% on ordinary income and 15% on qualified dividends and long-term capital gains.
• Employees and self-employed workers get a reduction of two percentage points in Social Security tax in 2011, bringing the rate down from 6.2% to 4.2% for employees, and from 12.4% to 10.4% for the self-employed.
• A two-year AMT “patch” for 2010 and 2011 provides a modest increase in AMT exemption amounts and allows personal nonrefundable credits to offset AMT as well as regular tax.
• Key tax credits for working families that were enacted or expanded in the American Recovery and Reinvestment Act of 2009 are retained. For example, the new law extends for two years (a) the $1,000 child tax credit (and maintains its expanded refundability), and (b) the American Opportunity tax credit for higher education, and its partial refundability.
• Two crackdowns on deductions for higher-income people have been deferred. For 2011 and 2012, higher-income individuals will not face a reduction in their itemized deductions or a phaseout of personal exemptions.
• Businesses can write off 100% of their new equipment and machinery purchases in the placed-in-service year, effective for property placed in service after September 8, 2010 and through December 31, 2011. For property placed in service in 2012, the new law provides for 50% additional first-year depreciation.
• Many of the popular tax breaks that went off the books at the end of 2009 have been retroactively reinstated for 2010 and extended through the end of 2011. Among many others, the retroactively reinstated and extended individual and business provisions include the election to take an itemized deduction for state and local general sales taxes instead of the itemized deduction for state and local income taxes; the $250 above-the-line deduction for certain expenses of elementary and secondary school teachers; and the research credit. The credit for making energy-saving improvements for a home has been extended for one year, through 2011, but much tougher rules apply after 2010.
• After a one-year hiatus, the estate tax will be reinstated for 2011 and 2012, with a top rate of 35% and a step-up in basis. The exemption amount will be $5 million per individual in 2011 and will be indexed to inflation in following years. Estates of people who died in 2010 can choose to follow either 2010′s or 2011′s rules.
If you would like more details about the new law, please do not hesitate to call us.
© 2010 Thomson Reuters/RIA. All rights reserved.
Jan 12 2011
You may be able to reduce your tax liability through smart debt management planning. Consider whether to defer cancellation of debt (COD) income from the reacquisition of an applicable debt instrument in 2010. The business can elect to have the cancelled COD income included in gross income ratably over five tax years beginning with the fourth tax year following the tax year in which the repurchase occurs (i.e., beginning with 2014). Contact our office for more information.
© 2010 Thomson Reuters/RIA. All rights reserved
Jan 11 2011
Our very own Larry Marietta will be a guest speaker at My REI Advisor Tele-Class:
Tax Strategies – Use Them To Your Advantage.
Mark Your Calendar – January 14th – Noon EST - Register At MyREIAdvisor.com for the FREE call today!
Start the New Year by positioning yourself for the best tax relief strategies. Do you know which ones are best for you and your business? Ask yourself the following:
Who Should Listen and Why
Selina Stoller is a successful real estate investor and educator. She manages investment properties, negotiates short sales for attorneys, invests in non-performing debt from banks and is an expert in the area of creating notes and mortgages for the purpose of seller financing. She is a member of CIREIA where she teaches realtors and investors to negotiate short sales and is a board member of the National Association of Mortgage Negotiators from which she has received honors. She is frequently invited to speak both locally and nationally, by many real estate companies and investment clubs. Learn more about Selina by visiting www.Defaultsolutionsgroup.com.
Matthew A. Griffith is an Indianapolis business and real estate attorney, and founder of the GRIFFITH LAW GROUP LLC – www.IndyBizLaw.com. He is a principle, director and co-founder of the business coaching firm, Xpedishon Coaching, LLC – www.Xpedishon.com. He also co-counsels client matters with attorneys at Vivo Law Offices, LLC through its virtual law service- www.IndianaVirtualLaw.com. Matt has represented, advised and taught real estate investors, professionals and tradesmen for more than 18 years. He also is a frequent speaker and writer on real estate and business matters. Matt can be reached at Matt@IndyBizLaw.com or 317.663.0650.
Colin Clark is the CEO/Founder of Tribeswell, a marketing and design firm based out of Bloomington, Indiana. Tribeswell provides design services to help businesses leverage both online and offline marketing channels. From website design, custom Facebook Fan pages, and Email Newsletter Templates to Print Advertisements and marketing strategy development, Tribeswell helps its clients compete in the marketplace. At Tribeswell we understand the impact your website makes on your image. Visit us at http://tribeswell.com.
Larry Marietta, CPA, is the owner of Marietta Financial Services, Inc. an Indianapolis CPA firm founded in 1998. Our firm specializes in tax planning strategies for small business and real estate investors. Our goal is to solve the accounting and tax problems of our clients. Problem solving is achieved by proper software selection, tactical research skills, dealing with the Federal and State governments and “big picture” strategies. We have vast experience in the partnership aspects of owning real estate. Larry is also a real estate investor who owns and manages two commercial buildings. 317.216.1040. www.mariettafinancial.com
Jeff Kolp has worked with State Farm and its customers since opening his agency in June 2008. In the last 2 years, he has positioned himself in the top 8% of State Farm agents nationally as a Legion of Honor agent, and has qualified annually for Ambassador Travel. Prior to joining State Farm Jeff worked in B2B sales and business development. He has 25 years experience in research, management and sales. Learn more about Jeff at www.JeffKolp.net
Dan Baldini biography coming soon.
Robert Shemin, JD, MBA, is one of the country’s most successful full time real estate investors and leading experts in the critical areas of buying and selling great deals, landlording, wealth building and asset protection. Mr. Shemin has been involved in over five hundred real estate transactions totaling more than fifty million dollars. He has renovated hundreds of houses and duplexes and owned and managed more than 150 rental properties–many of which he still owns and manages today.He has written nine bestselling books including, Secrets of A Millionaire Real Estate Investor, Successful Real Estate Investing: How to Avoid the 75 Most Costly Mistakes Every Investor Makes, Secrets of Buying and Selling Real Estate: Without Using Your Own Money, Secrets of a Millionaire Landlord, Unlimited Riches and his newest release, 40 Days to Success in Real Estate Investing. To contact: Phone: 1-888-302-8018. Email: info@sheminrealestate.com.
Matt Scott is the nation’s top-expert on raising funds for real estate ventures. OPM (Other People’s Money) is a key to his success in real estate and he’s discovered that in order to become successful partnering with others, you must have more than one size wrench in your toolbox. By expanding OPM well beyond what anyone else imagined, Matt has created an event based on his success using OPM.Matt gave up his employee status in May 1994 and is a full-time real estate entrepreneur with a Bachelor Degree in Accounting. His experience in the CPA firm made him realize entrepreneurs and investors are the wealthy not only in assets but in lifestyle and freedom. Visit Matt’s website at www.privatemoneybootcamp.com.
