| Started or Continuing in 20101 Beginning with tax year 2011, the IRS requires you to exclude from Form 1099-MISC any payments you made by credit card, debit card, gift card, or PayPal. You will need to report these payment types on the new Form 1099-K. Lower Tax Rates Extended The 2010 Tax Relief Act extends through the end of 2012 the tax rates in effect in 2010. They had been scheduled to increase to the higher tax rates that were in effect prior to 2001. Estate Tax For individuals dying after 2010, the federal estate tax continues with a $5 million exemption and a 35 percent maximum rate. The current federal estate tax rules are scheduled to end after 2012. Lower Capital Gains and Dividend Tax Rates Extended Through 2012 The tax rate reductions for long-term capital gains remain in effect for 2011 and 2012. Child Tax Credit The credit of $1,000 per eligible child continues through 2012. The credit was extended by two years by the 2010 Tax Relief Act. Payroll Tax Credit Starting in 2011, the partial credit for payroll taxes paid by employers is no longer available. Section 179 Expense Deduction The $500,000 maximum amount of equipment placed in service that businesses can expense and the annual investment limit of $2,000,000 remain in effect for 2011. Tax Credit for College Tuition The American Opportunity Tax Credit remains in effect through 2012. Earned Income Tax Credit (EITC) Temporary increases in the Earned Income Tax Credit for filers with three or more children and the higher income levels for the phaseout of the credit have been extended through the end of 2012. Mortgage Insurance Premiums The special itemized deduction for mortgage insurance premiums paid on mortgages taken out after 2006 expires on Dec. 31, 2010. Credit for Energy-Saving Home Improvements The 30 percent tax credit of the cost of energy-saving home improvements was extended by the Tax Relief Act of 2010 through 2011. |
| Cell: 415 308-0678 Fax: 415 704-3238 Lee@RileyAccounting.net 1001 Bridgeway, #229 Sausalito, CA 94965 Conference room locations; San Francisco Directions Map Sausalito Directions Map San Mateo Directions Map Larkspur Directions Map Walnut Creek Directions Map |
 |
| Robert Lee Riley CPA, MBA-tax |
| Riley Accounting |