Denise H. Lunt, CPA

Tax Identity Theft

Denise — Thu, 08 Mar 2012 02:32:40 +0000

You should know that the Social Security Administration releases the names and Social Security numbers of individuals when the Social Security Administration learns of a death. Criminals apparently know this and they troll the death reports. The criminals then file early tax returns to show refunds that they have sent to them. The IRS has designed a new identity theft filter system. If you become aware of tax identity theft or if you have been involved in identity theft. The IRS has a Form 14039 IRS Identity Theft Affidavit that you can file.

Our office can help you execute this form is you have had your identity stolen or are involved in an estate with identity theft. The key is to get the form done with the IRS as well other procedures that need to be done in cases of identity theft.

Hope none of you need our help with this. Being warned hopefully is being better prepared to deal with the problem.

Have a safe and wonderful week!
Denise H. Lunt, CPA

Payroll Tax Cut Extension

Denise — Sat, 25 Feb 2012 16:48:49 +0000

The President signed bill February 22 to extend the payroll tax cut to December 31, 2012. What that means to employer’s is that you will hold out the 4.2% social security tax and 1.45% medicare tax and the appropriate federal and state income tax in 2012. To employee’s that means your social security tax withheld will stay at the lower 4.2%. The self employed social security tax will be 10.4%. The maximum wage subject to social security tax in 2012 is still $110,100. The IRS is revising the payroll tax forms. So I would just remind you that if you use payroll tax software to calculate payroll checks, then it is vital that you make sure the software updates are installed before February 29, 2012. This should insure the payroll checks and payroll liability amounts are calculated correctly.

We have a great team to help you with all of these issues. So if you have questions or need help give us a call.

Have a great week!
Denise H. Lunt, CPA

2010 Estate Form 8939 Due January 17,2012

Denise — Thu, 05 Jan 2012 21:55:12 +0000

For decedents that died in 2010 that elected to have zero estate tax due a Form 8939 is required to be filed by January 17, 2012. If you are filing a Form 706 Estate tax form, this Form 8939 is not required. This is the documentation for the step up in bases allowed to be added above the decedent’s cost bases of assets owned by the decedent at date of their death. If our office needs to help you with this or answer questions please contact office immediately.

Also want to wish you all the best New Year and the healthiest, from our team. We are geared up and ready to start on another wonderful year with you.

Denise Lunt, CPA

Payroll Tax Cut Extended- 2012 Temporary

Denise — Tue, 03 Jan 2012 15:21:27 +0000

Nearly 160 million workers will benefit from the extension of the reduced payroll tax rate that has been in effect for 2011. The Temporary Payroll Tax Cut Continuation Act of 2011 temporarily extends the two percentage point payroll tax cut for employees, continuing the reduction of their Social Security tax withholding rate from 6.2 percent to 4.2 percent of wages paid through Feb 29,2012. This reduced Social Security withholding will have no effect on employees’ future Social Security benefits.

Employers should implement the new payroll tax rate as soon as possible in 2012 but not later than Jan 31, 2012. For any Social Security tax over-withheld during January, employers should make an offsetting adjustment in workers’ pay as soon as possible but not later than March 31, 2012.

If you use a payroll software such as quickbooks, you need to make sure you have done the appropriate payroll software updates before processing checks in 2012.

Have a blessed week!

Patti McKinney

ENERGY-SAVING CREDITS TO EXPIRE AT YEAR END

Denise — Mon, 15 Aug 2011 14:39:53 +0000

Your credit equals 10 percent of certain qualified home improvement expenditures plus 100 percent of certain other expenditures–subject to a rather stingy overall credit cap of $500. And you must reduce that already-skimpy cap by credits claimed in earlier years.
While the $500 cap is uninspiring, the good news is the credit covers a broad range of energy-saving expenditures for your principal U.S. residence, and there are no income limits. However improvements you made to a vacation home and foreign residence are not eligible. Your qualified expenditures include – Exterior windows, skylights; Exterior doors including storm doors; insulation; Metal and asphalt roofs with heat-reduction components.
You may remember that the 2010 version of this credit was much more generous. It equaled 30 percent of qualified expenditures — subject to a $1,500 cap. The current version with the $500 cap is scheduled to expire at year end. Because it is doubtful that the credit will be extended, you may need to take action this year to benefit.

Have a Blessed Day!

Patti McKinney

Estate Tax For 2010 Decedents

Denise — Thu, 11 Aug 2011 19:00:54 +0000

When you die there are estate taxes and filing requirments. If you have an estate with a fair market value over $5 million in 2011 you have to file a Form 706 and will have estate tax due. If you are in charge of an estate for someone who died in 2010 you have two choices. You can elect to be under the $5 million rule for estates in 2010 or you can file a Form 8939. The challenge is that the estate tax return is still in draft form and the election to do this is September 17, 2011. The Form 8939 is still not in the final form but we haven’t been given a deadline for this. So the pending deadline for the 2010 decedents is September 17, 2011. If you think you will be electing this method, you can get an extension on the Form 706. This extension does not protect you from penalties if you owe, so any balance due will need to be paid with the extension.

You need to call our office and make sure you have crunched the numbers and determined which method works for you. Basically you have to know the value of all assets to do this and you need to know if you can find or document the decedents basis in the assets.

This is just a brief description intended to alert you to the due date for the estate tax election deadline. Just call our office and the team will work with you to make sure you get the best deal.

Have a great week!
Denise Lunt, CPA

FUTA Tax Rate Changes

Denise — Mon, 11 Jul 2011 19:27:02 +0000

The FUTA rate was 6.2% for most of my clients before the state credits kicked in. So the net tax was .8% of the first $7,000 in wages. This was the FUTA rate for most. The rate included a surtax that was put in place in 1976. That .2% surtax expires on wages paid after July 1, 2011. You need to understand the rate you will be paying this month for wages in the second quarter of 2011 will remain at .8%. The rate you pay for wages paid in the third quarter (July 1, 2011 to September 30, 2011) will be .6%.

This is a good time to remind you that your FUTA rate is dependent on you paying your state(s) unemployment timely. It is very important to make sure you keep your state(s) unemployment reports and taxes filed and paid timely. If you do your payroll with quickbooks or some other software, this is a good time to make sure you have kept your updates current.

I will be glad to review this information with you in detail. This is just to make sure you know that the rate changed for third quarter wages. And you will still pay in same rate for the taxes you may be paying this very month.

Have a great week!
Denise H. Lunt, CPA

Household Employee Payroll Taxes

Denise — Thu, 07 Jul 2011 14:44:11 +0000

Every summer we remind all of our clients about the rules of household employee payroll tax rules. You are liable for payroll taxes on household help in 2011 for wages of $1,700 or more. The list of household help includes:

Baby-sitters
Cleaning people
Drivers
Housekeepers
Nannies
Health Aides
Private Nurses
Maids
Caretakers
Yard Workers
Similar Domestic Workers

This does not include wages you pay to your spouse, your child under the age of 21, in some cases your parent and employees under age 18 at any time during the year unless it is the employee’s principal occupation.

This is a short outline of the law. Our goal is to get you aware of the law. We will be glad to help you with the details and complying with the law. So please contact us if you find that you now have a household employee with wages of $1,700 or more.

Your questions are welcome and to be expected.

Have a great summer!!

Denise Lunt, CPA

IRS Increases Standard Mileage Rate July 1

Denise — Wed, 29 Jun 2011 15:21:49 +0000

The Internal Revenue Service announced because of the rising fuel costs, they were increasing the standard mileage rates. The new 55.5 cents per mile rate will apply to expenses incurred on or after
July 1, 2011. This is the rate that you use on business vehicles per mile. You may also receive reimbursed mileage for use of your vehicle from your employer. Our team will be glad to answer any questions you have.

Also coming is the July 4th day of celebration of our great country. Our office will be closed in honor of this great country on Monday July 4, 2011. Just want to wish all of you a safe and happy holiday.

Denise Lunt, CPA

Repealed 2012 1099 Requirements

Denise — Mon, 23 May 2011 19:37:50 +0000

In August of 2010 I notified you to watch for the new 1099 requirements that came with the health care bill. I am glad to report the new 1099 requirements have been repealed. Yeah!!!

Ok, having said that there are still 1099 requirements. We mail out letters annually with the basic requirements. I do not want to go into the detail with this. What you need to remember is it is still best practices to get a Form W-9 completed. The best time to get these forms completed is when you are paying the vendor and you still have leverage. You can go to the IRS website, irs.gov and go to forms and get the Form W-9. It needs to be completed and kept in your records. I have just been through 2 tax audits here for businesses. In both cases the agents asked for the 1099 forms that were filed. If you don’t think you understand the requirements for 1099’s call the office. We can give you that detailed information.

Just want to thank all the veterans and their families that have and are currently serving our country. Memorial Day is Monday and our office will be closed Friday and Monday in honor of Memorial Day.

God Bless You All!

Denise Lunt, CPA