TROTTER: Last-minute tax reminders for 2012
Every year, the IRS enacts certain changes to the tax code; some large — but most fairly small. There are those situations, however, where some changes to the tax code don’t receive as much notice as they should. This year is no exception. Here is a rundown of what may affect some taxpayers this year.
Don’t forget Form 8949 — If you are reporting capital gains or losses for 2011, you must, per information provided from the website advisorone.com, file this form along with your return.
Be Sure to Report Roth Rollovers — Did you convert or roll over a traditional IRA to a Roth IRA or other Roth Account in 2010? If you didn’t report the amount of the rollover on your 2010 federal return, you can report half the amount on your 2011 return and the remaining half in 2012.
Fuel Cell Motor Cars offer Tax Breaks — If you purchased a new fuel cell motor vehicle in 2011, it qualifies for an alternative motor vehicle credit. Be sure and note this only applies to new purchases.
If You’re Deducting Mileage, Rates Changed in the Middle of 2011 — The IRS is giving taxpayers a better break given the recent hike in gas prices. If you deduct mileage drive while operating your automobile or truck for business, the rate for the first six months of 2011 is $0.51 per mile and the rate for the last six months of 2011 is $0.555 per mile. The standard deduction for medical or moving mileage was also raised: $0.19 a mile from Jan.1 — June 30 and $0.235 a mile from July 1 — Dec. 31. The mileage deduction rate for providing services for charitable organizations , however, did not receive any mileage boost and remained at $0.14 for all of 2011.
There are Health Changes to Note for 2011 — If you have a Health Savings Account (HSA) or Medical Savings Account (MSA) healthcare plan, the range of qualified medical expenses was reduced in 2011 (once again using ww.advisorone.com sources). Last year, only prescription drugs and insulin counted as qualified medical expenses for these accounts. Another change worth noting: if you took a distribution from an HSA or MSA in 2011 that wasn’t used for a qualified medical expense, the tax penalty for that increased to 20 percent last year (to which I say ouch!). Lastly, be sure and take the self-employed health insurance deduction on your Form 1040 for 2011. If you are looking at Schedule SE and wondering where it went, it has migrated over to line 29 of Form 1040.
Be Sure and Check Where You Send your Returns — Some of the filing locations for federal tax returns have recently changed due to spending cuts. To make sure where your return goes, you can visit the website www.irs.gov to see where your return should be sent this year. And while it is probably the same address as always, it’s never a bad idea to check and see.
Finally, you get two extra days to file. Procrastinators, take heart; once again, the filing deadline this year falls on April 17. This is because April 15 and 16 in the District of Columbia is a federal holiday.
In conclusion, let me hasten to remind our readers to be sure and check with your tax professional as to questions concerning your own personal situation. But, to my way of thinking, any efforts expended that can result in saving a few bucks as it concerns taxes is time well spent.
>> Parting Shot — One of the most famous political quotes to come out of Washington was from the late Sen. Everett Dirksen of Illinois who, when asked about a spending measure Congress was considering, said “a billion here, a billion there, and pretty soon you’re talking real money”. At the rate our country’s budget is headed, we are approaching a financial stratosphere of money and debt that most can scarcely imagine. Here’s a math question pertaining to our country’s budget; most know that a trillion follows a billion. Do you know what comes after a trillion? The numeric answer, according to yahoo.com is: Quadrillion, Quintillion, Sextillion, Septillion, Octillion and then Nonillion. Unless we can turn this financial dilemma around, expect to see increasingly more and more “0’s” in the future. Incidentally, Dirksen is also on record as saying “ the oil can is mightier than the sword.” Truer words could not be spoken today in regards to certain OPEC countries who are waging economic warfare on us at the gas pump … and getting away with it.
To sign up for Mississippi Business Daily Updates, click here.
Top Posts & Pages
- District at Eastover construction to start later this year
- Fervor grows for Tuscaloosa Marine Shale
- Ex-Northwest Rankin coach David Coates dies before drug trial
- With no interim, board begins hunt for MVSU president
- LNG facility hoping to begin exporting natural gas
- WOODS: Time to put gloves on for handgrabbing
- Supervisors to talk with trustees about selling hospital
- The link between education and economic development