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July 2010 tax compliance calendar

July 18, 2010  |   Featured,News   |     |   0 Comment

July 2010 tax compliance calendar

As an individual or business, it is your responsibility to be aware of and to meet your tax filing/reporting deadlines. This calendar summarizes important tax reporting and filing data for individuals, businesses and other taxpayers for the month of July 2010. July 2 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates June 26-29. July 8 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates June 30. July 8 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 1-2. July 9 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 3-6. July 12 Employees who work for tips. Employees who received $20 or more in tips during June must report them to their employer using Form 4070. July 14 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 7-9. July 15 Monthly depositors. Monthly depositors must deposit employment taxes for payments in June. July 16 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 10-13. July 21 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 14-16. July 23 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 17-20. July 28 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 21-23. July 30 Employers. Semi-weekly depositors must deposit employment taxes for payroll dates July 24-27.

FAQ: Can I deduct the costs incurred doing charitable work?

July 18, 2010  |   News   |     |   0 Comment

FAQ: Can I deduct the costs incurred doing charitable work?

Q. I spend 20 hours every week cooking meals and delivering them to an organization that feeds the hungry and homeless. Am I entitled to a deduction for my time and the food I pay for out of my own money? A. Generally, if you do volunteer work for a charity, you are not entitled to deduct the cost of services you perform for the charity. However, if in connection with the volunteer work you incur out-of-pocket expenses, you may be entitled to deduct some of those expenses. Qualifying expenses If the amounts that you pay for food and other supplies used in the preparation and packaging of the meals are not reimbursed by the charity, generally you may deduct these expenses as contributions to the charity. In addition, if the amounts that you pay to travel by car or other means to deliver the meals are not reimbursed by the charity, and you derive no personal benefit from the travel, the expenses are deductible. Qualifying expenses include gasoline for your car and fares for taxis or public transportation. Special mileage rate If you drive your own vehicle to deliver the meals, you can use a special IRS mileage rate to calculate charitable contribution deductions involving ...

How Do I? Report interest from savings bonds?

July 18, 2010  |   News   |     |   0 Comment

How Do I? Report interest from savings bonds?

U.S. Savings Bonds can be a relatively risk-free investment during times of upheaval in the stock market, such as we are experiencing now. There are two different types of savings bonds for tax purposes. The first includes Series EE bonds and Series I bonds. You purchase these bonds at a discount from their face value and they accrue interest until reaching face value at maturity. If you invest in these bonds, you have a choice of reporting interest as it accrues each year you hold the bond or until you sell it or redeem it. A second category consists of a special type of savings bond, HH bonds, on which income generally must be reported as accrued. Series EE and I bonds Generally, you do not have to pay taxes on interest accruing on EE and I bonds until they mature. You can make a special election to pay tax on the interest as it accrues. Most investors choose not to make this election. However, if you have little or no other taxable income during the years in which the bond is maturing, you may be better off electing to pay tax annually as the bond earns interest until it reaches maturity, since you ...

Common IRA contribution and distribution mistakes

July 18, 2010  |   News   |     |   0 Comment

Common IRA contribution and distribution mistakes

Individual retirement accounts (IRAs) -- both traditional and Roth IRAs -- are among the most popular retirement savings vehicles today. Protecting the value of your IRA (and other retirement accounts) is incredibly important. While some factors affecting the value of your retirement savings may be out of your control, there are many things within your control that can help you safeguard the wealth of those accounts and further their growth. This article addresses common mistakes regarding IRA distributions and contributions, and how to avoid them. A recent report by the Treasury Inspector General for Tax Administration, which oversees IRS activities through investigative programs, reports that an increasing number of taxpayers are not complying with IRA contribution and distribution requirements. Mistakes include, among other things, making excess contributions that are left uncorrected or failing to take required minimum distributions from their IRAs. Making excess contributions Knowing the maximum amount that you can contribute to your IRA is imperative to avoid negative tax consequences. A 6-percent excise tax applies to any excess contribution made to a traditional or Roth IRA. In 2010, individuals can contribute up to $5,000 to both traditional and Roth IRAs. Individuals age 50 or older can also make "catch-up" contributions of ...

Navigating revised payroll Form 941 to maximize your HIRE credit

July 18, 2010  |   News   |     |   0 Comment

Navigating revised payroll Form 941 to maximize your HIRE credit

The IRS has revised Form 941, Employer's Quarterly Federal Tax Return, and its instruction to reflect the payroll forgiveness tax credit provided by the Hiring Incentives to Restore Employment (HIRE) Act. Form 941 was revised for use beginning in the second quarter of 2010. If you are claiming the credit for the second quarter, the deadline to file revised Form 941 to claim payroll tax forgiveness is quickly approaching: the second calendar quarter of 2010 ends June 30, 2010 and Form 941 is due by July 31 (August 2, 2010 under the weekend rule). Payroll tax forgiveness In brief, the HIRE Act provides qualified employers with payroll tax forgiveness. Qualified employers are exempt from the employer's 6.2 percent share of Social Security tax on all wages paid to covered employees from March 19, 2010 through December 31, 2010. To qualify, covered employees must begin work after February 3, 2010 and before January 1, 2011. Claiming the credit for the second quarter The payroll tax exemption is claimed on the revised Form 941 beginning with the second quarter of 2010. The HIRE Act does not allow employers to claim payroll tax forgiveness in the first calendar quarter, thereby providing for a credit in the second ...

Brace yourself for a sea change in the tax law

July 18, 2010  |   News   |     |   0 Comment

Brace yourself for a sea change in the tax law

A number of tax law changes are making their way through Congress, and many more on the way. These changes will affect both individual and business taxpayers alike. In 2010, it is expected that Congress will address the federal estate tax, and is currently working on small business and jobs "relief," as well as an extension of popular, but temporary tax incentives that expired at the end of 2009. This article provides a brief overview of what taxpayers can expect this year. Individual and business tax extenders Congress continues to debate the extension of a number of tax incentives for individuals and businesses that expired at the end of 2009. The tax breaks would be extended retroactively for one year, through December 31, 2010. A number of popular energy tax incentives and charitable deductions would be extended too. Among the individual incentives that would be extended are the popular additional standard deduction for real property taxes, the state and local sales tax deduction, and the higher education tuition deduction, as well as the teacher's classroom expense deduction. For business taxpayers, some of the tax incentives to be extended include the research tax credit, New Markets Tax Credit, differential pay credit, and the 15-year ...