Getting married involves hundreds of details and decisions, from wedding planning to house hunting to joint checking accounts. Although taxes may not be high on your priority list, it’s important to consider how you will file your annual returns as newlyweds. With tax season less than a year away, it’s a great time to look at some of the changes you may need to make for the IRS. Here are some basic tips:
Additional modifications to health care are anticipated for 2013 and 2014. (See Healthcare Changes for Small Business, part 1: 2010-2011 for the first installment.) Changes starting in 2013 Beginning in 2013, the itemized medical expense deduction floor will be raised from 7.5% to 10% in order to limit tax-subsidized medical expenses.
Believe it or not, we’re just a few short weeks away from the start of the 2009 tax filing season. One of the biggest taxpayer concerns—after “how much will my refund be?”—is the risk of making a mistake on a tax return. It can happen to even the most meticulous filer: after sending off your e-return to the IRS or dropping it in the mail, you notice an error. After the initial flurry of panic, you can relax—your return may technically be out of your hands, but it’s not set in stone just yet. The IRS has factored in a margin of error for busy taxpayers by providing the Form 1040X. The “X-file” allows you to specify what you reported on your original return, where the error was made, and what the correct figures are. You can even use the form to add or remove dependents or change your filing status. The IRS allows you to file an amendment up to three years after the original filing date. Below are a few CPA-recommended tips for filing the Form 1040X:
As we head into the heart of December, it’s time to start planning year-end tax strategies. There are several ways to maximize your 2009 savings by minimizing your taxable income through smart deductions. Below are a few tips: Retirement contributions: If you haven’t already reached the limit, now is the time to max out your contribution to your corporate 401K account. If you don’t work for a company, you might also consider contributing to a traditional IRA or SEP (self-employed) IRA. Your CPA can help you identify which retirement plans must be funded before the end of 2009, and which can be funded after the New Year. New vehicle deductions: Are you planning to buy a new car, truck, motorcycle, or RV in the coming year? If you complete the purchase before the New Year, you may be eligible to write off the sales tax as a deduction, depending on the amount of your total household income. Homebuyer and homeowner credit: In 2009, legislature was passed that granted first-time home buyers up to $8,000 in tax credits. This deduction is limited to taxpayers who have not bought a home in the last three years and whose incomes are below the maximum limit. If you’re planning to purchase a home in the near future, doing so before the end of the year will increase your 2009 tax savings. In addition, current homeowners may be eligible to deduct up to $6,500 in tax credits.
Whether you run a big corporation, a small start-up, or a busy household, your main tax concern is likely minimizing the amount you have to pay and maximizing the return you receive at the end of the year. One of the best ways to accomplish this is enlisting the services of a Certified Tax Professional, who can clue you into potential tax benefits. Below are just some of the breaks that are often overlooked by those who file their own returns: Medical expenses: If your annual medical bills add up to over 7.5% of your income, they can be written off as a tax deduction. While you can’t count portions that were paid by an insurance policy, any non-covered costs are eligible, including associated expenses like insurance premiums and mileage to and from a treatment facility. Property taxes: As of 2008, married couples filing jointly can enter a standard deduction of up to $1,000 for real estate taxes, and single homeowners can deduct up to $500—even if they don’t have enough deductions to file an itemized return on a Schedule A.