Monthly Archives: February 2010

Plug-In Electric Vehicle Credit (IRC 30 and IRC 30D)

Qualified Plug-in Electric Drive Motor Vehicles (IRC 30D) Internal Revenue Code Section 30D provides a credit for Qualified Plug-in Electric Drive Motor Vehicles including passenger vehicles and light trucks. Some low speed vehicles may qualify for the credit if acquired prior to January 1, 2010. The amount of the credit for 2009 is equal to [...]

How to Choose a Tax Return Preparer and Avoid Preparer Fraud

Taxpayers who decide they need assistance when preparing a tax return should choose a tax preparer with care and caution. Even if a return was prepared by an outside individual or firm, taxpayers should remember that they are legally responsible for what they file with the Internal Revenue Service. Most return preparers are professional, honest [...]

Tax Changes for Individuals

Alternative Minimum Tax (AMT) There are several changes affecting Alternative Minimum Tax for 2009. Child-Related Tax Changes Information on adoption benefits, child's investment income, the definition of a qualifying child, and additional child tax credit. Decreased Estimated Tax Payments for Qualified Individuals With Small Businesses For 2009, qualified individuals with small businesses may be eligible [...]

Benefit from Roth “ordering rules”

For the first time ever, taxpayers can convert a traditional IRA to a Roth, regardless of their annual income. Previously, conversions weren't allowed for taxpayers with a modified adjusted gross income (MAGI) over $100,000. But nothing has changed in the rules for Roth IRA distributions. Unless payouts are treated as "qualified distributions," they are subject [...]

Roth IRA conversion in 2010

The buzz about Roth IRA conversions is getting louder. And why not: For the first time ever, higher-income taxpayers can convert their traditional IRAs into a Roth. Beginning in 2010, the prior restriction for taxpayers with an adjusted gross income (AGI) above $100,000 is eliminated. Also, you can split the tax bill for a 2010 [...]

Wage Threshold for Household Employees

2008 Changes The social security and Medicare wage threshold for household employees is $1,600 for 2008. This means that if you pay a household employee cash wages of less than $1,600 in 2008, you do not have to report and pay social security and Medicare taxes on that employee's 2008 wages. 2009 Changes The social [...]

Standard Deduction Increased

The standard deduction for people who do not itemize their deductions on Schedule A (Form 1040) is, in most cases, higher for 2009 than it was for 2008. In addition to the annual increase due to inflation adjustments and the increase allowed for the deduction for certain real estate taxes and a net disaster loss, [...]

COBRA subsidies extended

The COBRA subsidy program was scheduled to expire on Dec. 31, 2009. But a late reprieve from the government keeps the program up-and-running awhile longer. The extensions were tacked onto a defense appropriations bill -- the Defense Appropriations Act of 2010 -- which was signed on Dec. 19, 2009. Under COBRA (short for the Consolidated [...]

Special Limitation Period for Retroactively Excluding Military Retirement Pay

If you retire from the armed services based on years of service and are later given a retroactive service-connected disability rating by the VA, your retirement pay for the retroactive period is excluded from income up to the amount of VA disability benefits you would have been entitled to receive. You can claim a refund [...]

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