Tax Deadline October 17, 2016

Tax Deadline

The tax filing deadline for individual income tax returns is October 17, 2016.

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IRS to Delay Tax Refunds in 2017

Tax RefundThe IRS has informed tax professionals of a new law that will be in force in 2017 for the filing season for 2016 tax returns. The new law will require the IRS to hold all tax returns that include refunds including Earned Income Tax Credit and Additional Child Tax Credits, until February 15th. This law will be used as a safeguard against identity theft and tax fraud. Those taxpayers that normally file early to get their refund early, will have their refund delayed by the IRS. The IRS will begin issuing the early filing refunds on February 15th. The additional time to process the refunds will assist the IRS in detecting identity theft and potentially preventing tax fraud.

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Healthcare Coverage Reporting Due Dates Extended

Affordable Care ActThe IRS announced the due date for providing Form 1095-B, Health Coverage and Form 1095-C, Employer Provided Health Insurance Offer and Coverage, is extended from February 1, 2016 to March 31, 2016.

Also, announced is the due date for filing the 2015 Form 1094-B, Transmittal of Health Coverage Information Returns, for Form 1095-B Health Coverage, and Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns for Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from February 29, 2016 to May 31, 2016 if not filed electronically.

Since Form 1095-C generally includes information about health care coverage and is used to determine eligibility for the premium tax credit, the delayed due dates for reporting may affect the timing of your reporting for health care credits. Some employees (and related individuals) who enrolled in coverage through the Marketplace, but did not receive a determination from the Marketplace that the offer of employer-sponsored coverage was not affordable, could be affected if they do not receive their forms 1095-C prior to filing their tax returns. As a result, for the tax year 2015 only, taxpayers who rely upon other information received from employers, about their offers of coverage for purposes of determining eligibility for the premium tax credit when filing their income tax returns, need not amend their returns once they receive their forms 1095-C or any corrected forms 1095-C.

Individual taxpayers who use form 1095-B or form 1095-C to confirm that they had minimum essential coverage for purposes may not have this information before tax time. For the 2015 tax year only, taxpayers who rely upon other information received from coverage providers about their coverage will not need to amend their tax returns after receipt of the form 1095-B or form 1095-C or any corrections.

2016 Tax Season Start Date

irs with 1040The IRS announced the 2016 tax filing season start date will be Tuesday, January 19, 2016. Paper filed and electronically filed returns will be accepted by the IRS on Tuesday, January 19, 2016.

Let the fun begin!

10 Tax Changes for 2016

taxes made from money2016 is right around the corner and brings tax changes for you to know. Understanding the tax changes will enable you to properly plan and help you to maximize your tax savings.

  1. Tax Filing Day is April 18, 2016. If you are a resident of a New England state that celebrates Patriots Day, your tax filing deadline is April 19, 2016.
  2. Tax Penalties for Obamacare increase. The ACA penalty for not having qualified healthcare coverage rises to $285 per adult, or 2% of income above the filing limit in 2015. For 2016, penalties will rise again, hitting $695 per adult, or 2.5% of income.
  3. Tax Brackets Increase. Tax brackets are adjusted for inflation at about 0.4%.
  4. Standard Deduction for Head of Household Filers Rise. For those who qualify as heads of household, the standard deduction will rise $50 to $9,300 in 2016.
  5. Personal Exemptions Rise. The personal exemption for 2016 will be $4,050, which is an increase of $50.
  6. Health Savings Account Contribution Limits Increase. For 2016, the contribution limit for individual policies will remain at $3,350, but the maximum contribution for family policies will rise by $100 to $6,750. A catch-up contribution of $1,000 for those 55 or older will continue to apply.
  7. Earned Income Credit Rises. For those with three or more qualifying children, the maximum credit will rise to $6,269, up $27. Those with two children will get a maximum $5,572, which is up $24 from 2015, while one-child families can get up to $3,373, $14 more than last year. Those without children get just a $3 bump and can claim up to $506 for 2016.
  8. AMT Exemption is Higher. Single taxpayers will see their AMT exemptions go up $300 in 2016 to $53,900, while joint filers will see a $500 boost to $83,800.
  9. Estate Tax Exemption Increases. The exemption amount will rise to $5.45 million, up $20,000 from 2015. The limit applies to estates of those who pass away in 2016.
  10. Other Tax Provisions Pending Renewal. Again, lawmakers wait until the last minute to renew popular tax breaks, such as charitable distribution from IRAs, state sales tax deductions, teachers’ write-offs for classroom supplies, and deductions for private mortgage insurance. As of early December, these provisions hadn’t yet been renewed for 2015, but typically, lawmakers renew them retroactive to the beginning of the year. The same is likely in 2016 unless an extension provides for two years of relief rather than just one.

Read more at 10 Biggest Income Tax Changes to Plan for in 2016 by USA Today

Year End Tax Tips For Businesses

Tax TipsYear end is upon us and it is not too late to review the tax tips for businesses to maximize tax savings for 2015.

  • Filing Changes: Partnership tax returns will be due on March 15, not April 15; C Corporations will be due on April 15, not March 15; S Corporation tax returns will continue to be due on March 15.
  • Code Sec. 179 expensing as a key component of year-end tax planning. Sec. 179 property is generally defined as new or used depreciable tangible property purchased for use in a trade or business. Software was also recently included, as was qualified leasehold improvement property, qualified restaurant property and qualified retail improvement property. (Congress has not renewed the enhancements to Sec. 179 expensing for 2015, but they likely will be renewed.)
  • Work Opportunity Tax CreditIf your business is considering expanding payrolls before 2015 ends, take a look at the Work Opportunity Tax Credit (WOTC).  (Although the WOTC, under current law, expired after 2014, Congress is expected to renew the WOTC for 2015 and possibly for 2016).Generally, the WOTC rewards employers that hire individuals from certain groups, including veterans, families receiving certain government benefits, and individuals who receive supplemental Social Security Income or long-term family assistance. The credit is generally equal to 40 percent of the qualified worker’s first-year wages up to $6,000 ($3,000 for summer youths and $12,000, $14,000, or $24,000 for certain qualified veterans). For long-term family-aid recipients, the credit is equal to 40 percent of the first $10,000 in qualified first-year wages and half of the first $10,000 of qualified second-year wages.

You can review the entire article provided by the National Society of Accountants at Year End Tax Tips For Businesses by NSA

 

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Tax Tips – Is It Tax Deductible? – Donate an Auto

Tax TipsLearn tax tips so you will be informed and can save money on taxes!

Question – What is the tax deduction when I donate my car?

Example – When you donate your old car to charity, what’s the write-off?

Answer – Kelly Blue Book Value or Price at which the donated car is sold by the charity?

 

The answer is PRICE AT WHICH THE DONATED CAR IS SOLD BY THE CHARITY.

In most cases, your deduction is limited to the price paid for the vehicle when it is sold by the charity to raise cash. But, there’s a notable exception:

If the charity uses the vehicle in its mission (to deliver meals to the needy, for example) or fixes it up and gives it (or sells it for less than market value) to a needy family, you are allowed to claim a deduction equal to the vehicle’s fair market value (check used car guidebooks or Web sites). That could produce a bigger write-off since the value a charity gets at auction is likely to be a lower wholesale or even fire-sale price.Donate a Car

 

 

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