2012 TAX CHANGES FOR INDIVIDUALS

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ABA Tax Accounting | Tax Services | St. Paul, MN Accounting Firm
Here's what individuals and families need to know about tax changes for 2012.

From personal deductions to tax credits and educational expenses, many of the tax changes relating to individuals remain in effect through 2012 and are the result of tax provisions that were either modified or extended by the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 that became law on December 17, 2010. 

• Personal Exemptions - The personal and dependent exemption for tax year 2012 is $3,800, up $100 from 2011. 
• Standard Deductions - In 2012 the standard deduction for married couples filing a joint return is $11,900, up $300 from 2011 and for singles and married individuals filing separately it's $5,950, up $150. For heads of household the deduction is $8,700, up $200 from 2011. The additional standard deduction for blind people and senior citizens in 2012 is unchanged from 2011, remaining at $1,150 for married individuals and $1,450 for singles and heads of household. 
• Income Tax Rates - Due to inflation, tax-bracket thresholds will increase for every filing status. For example, the taxable-income threshold separating the 15-percent bracket from the 25-percent bracket is $70,700 for a married couple filing a joint return, up from $69,000 in 2011. 
• Estate and Gift Taxes - The recent overhaul of estate and gift taxes means that there is an exemption of $5.12 million per individual for estate, gift and generation-skipping taxes, with a top rate of 35%. The annual exclusion for gifts remains at $13,000. 
• Alternative Minimum Tax (AMT) - AMT exemption amounts for 2012 have reverted to 2000 levels and will remain significantly lower than in 2011 unless Congress takes action before year-end: $33,750 for single and head of household fliers, $45,000 for married people filing jointly and for qualifying widows or widowers, and $22,500 for married people filing separately. 
• Marriage Penalty Relief - For 2012, the basic standard deduction for a married couple filing jointly is $11,900, up $300 from 2011. 
• Long Term Capital Gains - In 2012, long-term gains for assets held at least one year are taxed at a flat rate of 15% for taxpayers above the 25% tax bracket. For taxpayers in lower tax brackets, the long-term capital gains rate is 0%.

Give us a call. We'll sit down with you, discuss your specific tax and financial needs, and develop a plan that works for your business.ABA Tax Accountinginfo@abataxaccounting.com612-282-3200866-936-0430 Toll Freehttp://www.abataxaccounting.comwww.abataxaccounting.wordpress.com

DAMNED IF THEY DO AND DAMNED IF THEY DON'T

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Itis December already and there is no progress in Washington on “taxmegeddon”.
If(or more likely when) BO and the idiots in Congress fail to act on the “fiscalcliff” issues before the end of 2012, what is the IRS going to do regardingwithholding tables for 2013?
Ifthe Service follows “current” law, federal income tax withholding will substantiallyincrease for many, if not most, employees, as the so-called “Bush tax cuts”will have expired on December 31, 2012, and everything will go back to pre-Bushrules.  If the idiots in Washingtoneventually pass retroactive extensions of the expiring breaks, the IRS willneed to revise the withholding tables, as will software companies, andwithholding will be totally FU-ed for an extended period of time, resulting inlower pay checks for almost all employees for a couple of months.
Ifthe Service assumes the idiots in Washington will eventually pass retroactiveextensions and does not change the federal withholding tables, keeping everythingthe same as 2012 or with some inflation adjustments, and the idiots inWashington do nothing, the IRS will need to revise the withholding tables, aswill software companies, and withholding will be totally FU-ed for an extendedperiod of time, resulting in many employees being under-withheld for the yearand owing tax when filing their 2013 returns.
Unfortunatelyit is we taxpayers, not the IRS or the idiots in Washington, who may be damnedif they do and damned if they don’t.
Wemust hope that whatever assumption the IRS uses to determine federal income taxwithholding effective January 1, 2013 turns out to be correct. 
TTFN 

WHAT'S NEW FOR NEW YORK STATE INCOME TAXES FOR 2012

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The2012 New York State income tax returns are now available online.
Thefirst thing I noticed is that Page 1 of the IT-201 and IT-203 resident andnon-resident income tax forms are expanded to include a detailed listing ofdependents. 
Theforms are still 4 pages, and the space for the dependent listing section ismade by eliminating the detail for itemized deductions previously on the bottomhalf of Page 2.  The itemized deductionschedule has been moved to new Forms IT-201-D and IT-203-D.  
Goodnews, at least for me.  Forms IT-2,IT-1099-R, and IT-1099-UI have been eliminated! I no longer have to waste my time filling in these stupid forms.  We now merely attach the state copy of theW-2 and appropriate 1099s with the filing of the return, like with the federaland other state filings, and like what used to be the case with NY state filings.  Thank God for small favors.  
Taxrates have been reduced for taxpayers with taxable incomes of over $40,000. andthe tax computation worksheets for taxpayers with New York adjusted grossincome of more than $100,000 are now based on filing status.
Taxpayersrequesting direct deposit are asked some additional information about the bank accountto which refunds are to be deposited, and taxpayers must now enter only whole dollaramounts on income tax forms (nothing major here – I have never used cents ontax returns, except for some dependent returns).
Thereare a couple of new tax credits for 2012, including a “Beer Production Credit”.  Too bad there is not a “Beer ConsumptionCredit”.
The2012 NJ returns are not yet available.  Iwill let you know when they are.

2012 – THE YEAR IN TAXES

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It is timefor my annual tax year in review post.Thetax filing season went relatively smoothly. Due to the idiots in Congress’ inability to think or act there wasnothing new in actual tax law – what is taxable and what is deductible – and nounnecessary processing delays for 2011 returns (except for early returns filedelectronically – which did not affect me). The expiring Bush Tax cuts, the usual extenders, and BO’s AmericanOpportunity Credit had all been extended through at least the end of 2011 in arelatively timely manner.  
Ihad been concerned before the season officially began (for me February 1st)that the major tax forms (1040, 1040A, Schedules A + B) were no longeravailable at local Post Offices – but soon discovered that the forms were nowavailable (although in a bit less “bulk) at local libraries.  As a pleasant surprise I found that, whilethe libraries did not have NJ-1040 forms, they did have New York IT-201s andIT-203s!
Themajor issue of this tax season involved the new requirements for cost basisreporting, and the resulting new Form 8949 and the revised Schedule D.  For tax year 2011 brokers were required toreport to client taxpayers, and to the IRS, the cost basis of most stocks,including foreign stocks, acquired on or after January 1, 2011 (“covered”securities) on Form 1099-B.
TheForm 8949 was used to report the individual short-term and long-termtransactions in three separate categories – sales where the cost basis wasreported to the IRS on Form 1099-B, sales where the cost basis was not reportedto the IRS on Form 1099-B, and sales that were not reported on a Form1099-B.  A separate Form 8949 wasrequired for each of the three categories. The Schedule D served as a summary of the 8949s.
Thevarious brokerage and mutual fund houses all responded to the new reportingrequirements differently, some excellently and a few poorly.  This new system required some additionaltime, but only a few cases generated additional agita. 
Thealso new requirement of credit and debit card merchants and third-party payerslike PayPal to report transactions to the IRS, and to the recipient, turnedout, despite initial concerns, to be a non-issue, as taxpayers did not have toseparately report this income on 2011 Schedules C, E, F and entity returns.
Theonly other major reporting change was in the format of Page 1 of the Schedule E(rental and royalty income and deductions). This was a PITA at first (I really saw no need for the revisions), but Isoon got used to it.
Therewere no major problems within my own practice during the season.  My new, faster, laptop, its cable access, andmy copy machine ran smoothly throughout the 2½ months.  The printer, while deciding it would onlyprint colored pages in pink, and the black printing being less than perfect,did not slow down operations.  There wereno issues with my car or any personal concerns to distract and take time awayfrom the job at hand.  And there were noindividual client issues.
TheInternal Revenue Service lost two of the major architects of the current taxreturn preparer regime in 2012 via resignation. David R. Williams, first head of the Return Preparer Office, resigned atthe end of August, replaced by Carol A. Campbell.  And Commissioner Doug Shulman stepped down onNovember 9^th.  IRS Deputy Commissionerfor Services and Enforcement Steven Miller, a 25-year veteran of the agency,took over as Acting Commissioner
Davidwill certainly be missed.  While he and Idisagreed on some of the details of the regulation regime, specificallyexempting CPAs, attorneys, and “supervised employees” from the samerequirements as other PTIN-holders and a grandfathering exemption from the testfor experienced preparers, he did a good job as the face of tax pro regulation.
2012was the first year that non-exempt PTIN-holders were required to take at least15 hours of CPE in federal taxation, including 3 hours of updates and 2 hoursof ethics.  As David predicted, many newCPE providers jumped on the bandwagon.  Anumber of tax preparer “quasi-membership” organizations sprang up during theyear, most of them solely for the purpose of promoting for-profit companies’CPE classes.  My email in-box has beenchock-a-block with CPE offerings for the past few months.  I had considered becoming a CPE provider, butdecided against it for now.
Ihave always taken more than the required 15 credits each year, most, if notall, being classes offered by the National Association of TaxProfessionals.  2012 was no different – Iended the year with 24 credits of federal CPE (and 8 more of state tax CPE).
Theconstitutionality of “Obamacare” had been in question since its passage.  In June of this year the Supreme Court upheldthe law. The Supreme Court’s decision, combined with President Obama’s re-election,ensured that Obamacare is here to stay, at least for a while, and its tax hikeswill kick in next year.
Thebiggest tax story for 2012, once again (the 3^rd year in a row thishas been the biggest tax story!), was the continued inability of the idiots inCongress to accomplish anything.  Thepopular package of “extenders”, including the temporary AMT patch, expired onDecember 31, 2011, and the various Bush and Obama tax cuts and benefits arescheduled to expire on December 31, 2012. As of this writing nothing has been done by the idiots in Washington toextend anything.  The result - the startof the upcoming tax filing season, and the processing of refunds, will bedelayed, and the country faces what has been called “Taxmagedden” on January 1,2013, as it tumbles over the “fiscal cliff”.  
Havingdone nothing all year, the idiots shouldhave just extended everything expired and expiring through 2013 (similar towhat they did in 2011) after the election and begin 2013 with serious work onserious tax reform.  At the very leastthey should have extended the AMT patch through the end of 2012.  But then again – they are idiots!
Overthe past years the members of Congress have proven that they are incompetentand ineffective dolts with no concern for the American public, and areincapable of compromise or of independent thought.  The current Congress has one of the lowestapproval ratings in history, although despite this fact most incumbents who ranin November were re-elected.  As I saidearlier, I guess the thinking was the incompetent idiot you know is better thanthe incompetent idiot you don’t.   
And, according to the NBC report “Congressto Make History -- But for the Wrong Reason” (highlight is mine) -
“By passing just 196 bills into law so far, it is in the running to become the least productive Congress since the1940s.
In fact, that amount is 710 fewer public laws than was producedby the 80th Congress (from 1947-48), which first earned the moniker‘Do-Nothing’ Congress.”
Christopher Bergin of THETAX ANALYSTS BLOG read the minds of the idiots in Congress and quoted theirChristmas message to America in his recent post “Tin Ear Tinhorns” –
“MerryChristmas from Washington, D.C. Here’s your bag of coal.
It’schilly here in Washington. We don’t care how it is where you are. We don’t careabout your 401k plan. We don’t care about whether you have to pay theAlternative Minimum Tax for this year. We don’t care if you don’t get your taxrefund on time or if you have to wait to file your tax return until July. Wejust don’t care.
InWashington, all we see is ourselves. We drive around in our self-importanthaze, yapping on our cell phones and cutting people off on I-66 because what weare doing is all that matters and is certainly more important than anythingyou’re doing.”
The 2011 Tax Offender ofthe Year Award, presented each year by Russ Fox of TAXABLE TALK, wasCongress.  The criteria for the award – “it really needs to be a Bozo-like action oractions”.  Chances are very good thatthe idiots in Congress will be the recipient of this designation again for2012.
There is nothing toindicate that the new Congress to be seated in January of 2013 will be any lessincompetent or ineffective, or will have any more concern for the Americanpublic, than the current, retiring one.
And let us not forget that 2012 wasa Presidential election year – which only further motivated the inaction of theidiots in Congress.  While the two-yearcampaign did highlight the need for tax reform, the result was a blow to thehopes for a substantive rewriting of the Code. BO’s tax plank called for more complexity and confusion and continuedmisuse of the Code.  
Atthe end of my 2011 tax year in review post I predicted –
“As2012 is an election year it is expected that nothing of any consequence will beaccomplished in the tax arena (or any other arena).  Next February the idiots in Congress willprobably extend the payroll tax cut for the rest of the year, and, as Isuggested above, next December they will pass the usual year-end extenders billand also continue the ‘Bush’ tax cuts for another year or two.”
I was almost 100% on the money,except for the idiots extending everything in December. 
Let us hope that 2013 will see thepassage of real tax reform – although I won’t hold my breath!
So, as I ask each year at the end ofthe post, did I forget anything?
TTFN

Important Payroll Update!

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Lend your eyes and ears to this important update!        Inuit has just released Payroll Update 2013, with revised tax tables. There are Several forms updates that are included for Standard and Enhanced Payroll customers. As you read this you should be asking yourself whether or not you have already received the Payroll Update 2013.        Not sure if you have received it or not? Don't worry! Below you'll find instructions on how to check to see whether or not you have gotten the update. Make sure that you have received everything in the P Update so that you can be in compliance with legislation that affects your payroll. For details on the contents of this update, open QuickBooks, go to Employees > Get Payroll Updates, and click on the Payroll Update Info button. How to check to see if I have the update? Open QuickBooks and choose Employees > Get Payroll Updates. You should see a message that says, "You are using tax table version: 21302." If you do not have version 21302, click Update. For more detailed instructions, click here. Turn on automatic updates feature for Payroll Updates: Choose Help > Update QuickBooks. On the Options tab, select Yes for Automatic Update. For more information, click here. Other Important News! Federal Tax Withholding Tables for 2013        At the time of this payroll update, the IRS had not published the 2013 federal withholding tables for wages paid in 2013. You should continue to use the current federal withholding tables.Once the IRS publishes the 2013 federal withholding tables, Intuit Payroll will include them in an upcoming payroll update. For more information, click here. New Payroll Tax Item: Medicare Employee Addl Tax       Beginning January 1, 2013, employers will be responsible for withholding an additional 0.9% Medicare tax from an employee's wages and compensation paid over $200,000 in a calendar year. Click here for more information on the additional tax. A new payroll tax item, Medicare Employee Addl Tax, has been added to QuickBooks. If you have employees who are subject to Medicare tax, you should set up the new payroll tax item in QuickBooks prior to creating paychecks for 2013.

Schuylkill River Fishing and Free Animal Zoo in Royersford, PA

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If you are looking for a quick free zoo trip in Montgomery County there is a cool place to go that won't cost you any money. I must be honest, technically it isn't a zoo either but there are plenty of animals held captive at their nature center to make for a fun, quick and cheap trip right in Montgomery County, PA.

Royersford is an area with things to do near Norristown and the surrounding region. They have a place were you can see wolves, foxes, all kinds of hawks, a donkey, goats, turkeys and more all for no price at all.

This is also a rather nice looking fishing spot along the Schuylkill Rivers well. The river is just behind this place and they welcome fisherman to come and fish the day away (PA fishing rules apply of course).

If you are interested in learning more about this great place for casting out your line or learning about indigenous animals of Pennsylvania, check out the post I have linked below.

Click Here for Schuylkill River Fishing and Free Animal Zoo in Royersford, PA

Please also check out some of my other posts both on this site, TurtleDogs Blog and the site I've linked to below called Things to Do In Norristown. Things to Do In Norristown is just what it sounds like. If you live in Pennsylvania this site will show you some ideas to keep you entertained and busy.

Check it out sometime.  I'd love it if you stopped by.


Thanks again for coming by. Again, please check out some more posts on this site, TurtleDogsBlog for great tips on doing just about anything whether it be taking a trip, fixing things around the house, help on your computer, tips on the internet or just general help.  I'm here to help out.

 

DAMNED IF THEY DO AND DAMNED IF THEY DON'T

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Itis December already and there is no progress in Washington on “taxmegeddon”.
If(or more likely when) BO and the idiots in Congress fail to act on the “fiscalcliff” issues before the end of 2012, what is the IRS going to do regardingwithholding tables for 2013?
Ifthe Service follows “current” law, federal income tax withholding will substantiallyincrease for many, if not most, employees, as the so-called “Bush tax cuts”will have expired on December 31, 2012, and everything will go back to pre-Bushrules.  If the idiots in Washingtoneventually pass retroactive extensions of the expiring breaks, the IRS willneed to revise the withholding tables, as will software companies, andwithholding will be totally FU-ed for an extended period of time, resulting inlower pay checks for almost all employees for a couple of months.
Ifthe Service assumes the idiots in Washington will eventually pass retroactiveextensions and does not change the federal withholding tables, keeping everythingthe same as 2012 or with some inflation adjustments, and the idiots inWashington do nothing, the IRS will need to revise the withholding tables, aswill software companies, and withholding will be totally FU-ed for an extendedperiod of time, resulting in many employees being under-withheld for the yearand owing tax when filing their 2013 returns.
Unfortunatelyit is we taxpayers, not the IRS or the idiots in Washington, who may be damnedif they do and damned if they don’t.
Wemust hope that whatever assumption the IRS uses to determine federal income taxwithholding effective January 1, 2013 turns out to be correct. 
TTFN 

WHAT'S NEW FOR NEW YORK STATE INCOME TAXES FOR 2012

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The2012 New York State income tax returns are now available online.
Thefirst thing I noticed is that Page 1 of the IT-201 and IT-203 resident andnon-resident income tax forms are expanded to include a detailed listing ofdependents. 
Theforms are still 4 pages, and the space for the dependent listing section ismade by eliminating the detail for itemized deductions previously on the bottomhalf of Page 2.  The itemized deductionschedule has been moved to new Forms IT-201-D and IT-203-D.  
Goodnews, at least for me.  Forms IT-2,IT-1099-R, and IT-1099-UI have been eliminated! I no longer have to waste my time filling in these stupid forms.  We now merely attach the state copy of theW-2 and appropriate 1099s with the filing of the return, like with the federaland other state filings, and like what used to be the case with NY state filings.  Thank God for small favors.  
Taxrates have been reduced for taxpayers with taxable incomes of over $40,000. andthe tax computation worksheets for taxpayers with New York adjusted grossincome of more than $100,000 are now based on filing status.
Taxpayersrequesting direct deposit are asked some additional information about the bank accountto which refunds are to be deposited, and taxpayers must now enter only whole dollaramounts on income tax forms (nothing major here – I have never used cents ontax returns, except for some dependent returns).
Thereare a couple of new tax credits for 2012, including a “Beer Production Credit”.  Too bad there is not a “Beer ConsumptionCredit”.
The2012 NJ returns are not yet available.  Iwill let you know when they are.

WHAT’S THE BUZZ? TELL ME WHAT’S A HAPPENNIN’ - SPECIAL FRIDAY EDITION!

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Anotherspecial Friday edition of the BUZZ!
* There isstill time for you to order my stocking stuffers!  Click here and here and here and here.  Hey, it is ok to buy them for yourself (andthey are tax deductible)!
* And don’tforget my special pre-publication offer for MY BEST TAX ADVICE.
*I never thought I would ever reference something written by an idiot fromCongress in a positive light here.  But heregoes.  An editorial by Sen. Jeff Bingaman,a Democrat at that, actually gets it right! He tells the other idiots in Washington, “Don’t Tie Tax Extenders Bill to Fiscal Cliff”.
He correctly says (highlight ismine) –
“Lostamong the fiscal cliff debates on marginal tax rates and the sequester is abipartisan package of important tax cuts that the House and the Senate shouldtake up and pass immediately,regardless of whether Democrats and Republicans can reach a larger compromise.”
And –
“WhileI hope the negotiations to avert the fiscal cliff are successful, we should notwait for a “grand bargain” to materialize before we finish our work on tax extenders.Tax extenders are different from the other fiscal cliff issues.”
Who knew an idiot from Congresscould actually say something smart!  As Iwrite this I am looking out my window for airborne pigs.
* Along these lines, ACCOUNTINGTODAY reports that “IRS Warns Congress Tax Season Might Be Delayed until March or Later without AMT Patch”.
*The WALL STREET JOURNAL knows “A Bad Budget Deal” when they see one, and feel,“Higher taxes now for notional reformlater is worse than nothing”.
They also tell us (highlight ismine) –
“It'sclear by now that the budget talks are drifting in a drearily familiarWashington direction: Tax and spending increases now, in return for the promiseof spending cuts and tax and entitlement reform later. This is a bad deal for everyone except the politicians who want moremoney to spend.”
* TrishMcIntire explains the IRS “Identity Theft PIN” at OUR TAXING TIMES.
*Jamaal Solomon, himself an EA, lists the latest in a series of “Reasons Why You Should Love EAs: John Sheeley, EA” at TAX FACTOR.
WhileI have never met John, he has been an online friend and supporter for severalyears.
BTW,Jamaal is correct when he says, “EAs arethe only federally licensed tax practitioners who specialize in taxation andalso have unlimited rights to represent taxpayers before the IRS.”  RTRPs may be federally licensed taxpractitioners who specialize in taxation, but their rights to representtaxpayers before the IRS is limited.  AndCPAs may have unlimited rights to represent taxpayers before the IRS, but theyare in no way, shape or form federally licensed tax practitioners whospecialize in taxation.
*I came across some good non-tax news via CNN MONEY (by way of theAccountantsWorld.com daily headlines) – “Refunds from Credit Card Issuers on the Way”.
Ijust wish we didn’t have to wait till March to get the credit.
*The TAX ADVISOR’s Tax Clinic reminds us of the importance of “Contemporaneous Documentation of Charitable Contributions”.
Thisitem elaborates on what I included in my MAINSTREET.COM article “How to Give at the Holidays With Tax Day in Mind”. 
*Kay Bell has been running a series titled “Reindeer Year-end Tax Games”, withyear-end tips provided each day by Santa’s sleigh-pullers.  For example, #7 was “Donder Says Harvest Investment Losses”.     
*Paul Neiffer explains the annual gift tax exclusion in “Annual Exclusion Update”at FARM CPA TODAY.  
*Kelly Phillips Erb, the internet’s TaxGirl, has a thoughtful post worth readingat FORBES.COM – “Lawmakers, Guns and Money: Where Do We Go After Sandy Hook?”.
*And Kelly continues her “12 Days of Charitable Giving 2012” by highlighting “Doctors Without Borders”.
THELAST WORD
Ihope you have a “successful” Christmas holiday!
Iwill be continuing with my annual tradition of typing W-2s on Christmas Eve(and New Years’ Eve), and driving to New Jersey for a homemade Christmas Daydinner with my sister.  As such, this yearI am NOT dreaming of a white Christmas.
Don'tforget animals in your holiday charitable giving. Support your local non-profitanimal shelters & rescue groups. Check out www.petfinder.org.
“Talk”to you again next Wednesday!
HO!HO! HO!
TTFN

WHAT’S NEW FOR NJ INCOME TAXES FOR 2012

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The2012 NJ state income tax forms and instructions are now available at the NJ Divisionof Taxation website.
Thebig change for the 2012 NJ-1040 is the new “Alternative Business Calculation Adjustment”.
Beginningwith 2012, taxpayers who have losses in the categories of -
·     netprofits from business,·     netgains or net income from rents, royalties, patents, and copyrights,·     distributiveshare of partnership income, and ·     netpro rata share of S corporation income -    can use the losses to calculate anadjustment to their taxable income (“Alternative Business CalculationAdjustment”). 
Thepercentage used to calculate the adjustment is being phased in over five years.The percentage will increase from 10 percent for tax year 2012Taxpayers cancarry forward unused losses in those categories for a period of 20 years tocalculate future adjustments. 
Taxpayerswith income and/or losses in any of these categories must complete two newreturn schedules: Schedule NJ-BUS-1 (Business Income Summary Schedule), andSchedule NJ-BUS-2 (Alternative Business Calculation Adjustment) to calculatethe amount of their adjustment or loss carryforward.
Anew Line 34 has been added to Page 2 of the NJ-1040 to enter the AlternativeBusiness Calculation Adjustment.
Ilook forward to the January 2013 NJ-NATP “Famous State Tax Seminar” to learnhow this new adjustment will work.
Theonly other changes to the NJ-1040 are –
·     Anew worksheet has been developed (Worksheet G, Use Tax Calculation) to make iteasier for New Jersey residents to determine the amount to report on Line 45,Use Tax Due on Internet, Mail-Order, or Other Out-of-State Purchases.
·     Anew oval has been added below the signature line that must be filled in if acopy of a deceased taxpayer’s death certificate is enclosed with the return.This oval should be filled in and a copy of the death certificate enclosed onlyif there is a refund due and the check needs to be issued to the decedent’ssurviving spouse/civil union partner or estate.
·     Threenew funds have been added to the list of organizations to which taxpayers cancontribute on the New Jersey tax return – the Boys and Girls Clubs in NewJersey Fund, the NJ National Guard State Family Readiness Council Fund, and theAmerican Red Cross-NJ Fund.
Other than that the 2012 NJ-1040 isno different than the NJ-1040 of past years.
FYI - For 2012, the maximum employeeunemployment insurance/workforce development partnership fund/supplementalworkforce fund contribution (SUI) was $128.78, the maximum employee disabilityinsurance contribution (SDI) was $60.60, and the maximum employee family leaveinsurance contribution (FLI) was $24.24.
Iwas pleased to find that it appears there is no longer an income limitation forsubmitting a NJ-1040 online via the NJWebFile system.  I should be able to submit the 2012 NJ-1040for taxpayers with NJ Gross Incomes over $150,000 this way.
TTFN

WHAT FOOLS THESE POLITICIANS BE!

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Anonline article at NATIONAL JOURNAL dated Saturday told us, “Week five of the fiscal-cliff negotiationscame and went without any resolution”.
Todayis December 17^th.  The monthof December is more than half over. There are only two weeks left in the year.  And theidiots in Washington have not done a damned thing to avoid the serious problemsthat will result from the expired and expiring tax laws and the other issuesinvolved with the so-called “fiscal cliff”!
Ihave nothing but the utmost contempt for the idiots in Congress.  Thereis no legitimate excuse for their incompetence, inaction, and total disregardfor the American public.  Thesearseholes take our money, in the form of inflated paychecks and extensiveentitlements, and bitch and moan and bicker and blame and basically doabsolutely nothing but play with their private parts. 
Thelyrics from the musical 1776 echo in my ears – “Piddle, twiddle, and resolve. Not one damned thing do we {they}solve!”
Boththe Democrats and the Republicans, and their leaders (pictured above), areequally incompetent and equally to blame. 
Wehad the opportunity to throw many of the bums out this past November, but we(not me; my actions in the election booth, or rather in my case on the electiontable, reflected the concept of GRIP – Get Rid of Incumbent Politicians)re-elected most of them.  I suppose thethinking was the devil (incompetent idiot) we know is better than the devil(incompetent idiot) we don’t know.
Wehave all along assumed that these fools would eventually at least temporarily extend most of the already expired“extenders”, most important of which is the AMT patch, and the expiring “Bush”and other tax cuts for at least all but perhaps the “richest” taxpayers.  Well eventuallyis here!  
Whatwill happen if nothing is done?  The taxfiling season will not be able to start for most filers until March of 2013,seriously delaying refunds.  Thewithholding tables for 2013 will either be too little or too much, resulting ineither underwithholding or seriously reduced pay checks.  The federal income tax liability of justabout every American taxpayer will increase by potentially thousands of dollars(for the average middle class taxpayer too, and not just the “wealthy”).  And that is only the beginning.  Even if the problem is temporarily fixedretroactively in 2013 there will be delays, possible withholding FUs, and otherconsequences. 
Inshort, it will definitely not be a happy New Year!
Whatmore can I say? 
TTFN  

THIS AND THAT

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Hereelaborations on “stuff” that appeared in earlier posts.+ The“Last Word” of a recent BUZZ installment proposed a federal law.   Here isthe idea, slightly adjusted -  Let uspass a federal law that says (1) Taxlegislation CANNOT be temporary.  Exceptfor declared natural disasters or an official declaration of war, anylegislation that makes a change to the US Tax Code will automatically bepermanent, unless revised or repealed by specific subsequent legislation.And (2) Exceptfor declared natural disasters or an official declaration of war, any taxlegislation passed after September 30th cannot take effect until January 1st ofthe next year.Writteninto the legislation should be a requirement that a 2/3 majority of both housesof Congress would be needed to repeal or revise this law.Temporarytax law is not good tax policy (except perhaps for dealing with declarednatural disasters like KATRINA and SANDY). In the past the idiots in Congress have consistently extended the temporarytax breaks that become known as the “extenders”, often waiting until literallythe very last minute, and as a result causing problems and delays with the IRSprinting of forms and instructions and processing of returns, and confusingtaxpayers.The IRShad usually “gone to press” with tax forms, schedules and instructions for theyear in October.  Putting a September 30^thdeadline on making changes to the Tax Code in the current year will allow theIRS to return to this schedule.  It willalso make year-end tax planning much easier for individuals and businesses, asthey will know what will be in effect for the year during the last quarter andhave plenty of time to plan accordingly.+ Below isa recent comment on my post WHY WE NEED TAX REFORM by new tax blogger DavidFazio, EA -“You hit the nail squarely on the head: theCash for Clunkers program was a success because it kept the IRS out of theprocess. Taxpayers got their government discount (the equivalent of an IRS taxcredit) at the point of sale. They didn't have to wait up to a year to reap thebenefit. We have become a nation of deductionjunkies. Congress has tweaked the code so much that we start to feel that everydollar we spend should be deductible. We have special deductions/credits forteachers, adoption, child care, income earned outside the US, education,student loan interest and so on. Does a teacher with out-of-pocketexpenses deserve an above-the-line $250 deduction more than the schoolcafeteria worker who doesn't itemize and has $15 deducted out of her paycheckevery week for her uniform? Does the college graduate deserve a specialdeduction for his student loan interest when a Hurricane Sandy victim can'tdeduct interest on the credit card he's incurring while he's rebuilding hishome and waiting for the insurance check? Now no one said he taxcode was fair. But too many perks are being handed out via the 1040 that (asyou pointed out) are completely unnecessary.”Greatminds do think alike!  I havealways been confused by the $250 deduction for “educator expenses”.  The tax savings is $60-$70 for most educators.  Depending on where you live, this barelycovers the cost of a dinner out.  Andwhy, as David asks, were educators singled out. Are they more valuable than policemen, firemen, nurses, EMTs, or evenschool cafeteria workers, all of whom have “out of pocket” employee expenses?Therecipient of a special tax break, whatever it is, depends on either how muchthe recipient’s lobby pays the idiots in Congress to vote for it, or which special-interestgroup the idiots in Congress want to buy the votes of. David alsotalks about the student loan interest deduction, which is part of a group oftax benefits related to post-secondary education.  But, as I have said time and again, thisgroup should be replaced by direct “point of purchase” student financial aid.TTFN

WHAT'S NEW FOR NEW YORK STATE INCOME TAXES FOR 2012

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The2012 New York State income tax returns are now available online.
Thefirst thing I noticed is that Page 1 of the IT-201 and IT-203 resident andnon-resident income tax forms are expanded to include a detailed listing ofdependents. 
Theforms are still 4 pages, and the space for the dependent listing section ismade by eliminating the detail for itemized deductions previously on the bottomhalf of Page 2.  The itemized deductionschedule has been moved to new Forms IT-201-D and IT-203-D.  
Goodnews, at least for me.  Forms IT-2,IT-1099-R, and IT-1099-UI have been eliminated! I no longer have to waste my time filling in these stupid forms.  We now merely attach the state copy of theW-2 and appropriate 1099s with the filing of the return, like with the federaland other state filings, and like what used to be the case with NY state filings.  Thank God for small favors.  
Taxrates have been reduced for taxpayers with taxable incomes of over $40,000. andthe tax computation worksheets for taxpayers with New York adjusted grossincome of more than $100,000 are now based on filing status.
Taxpayersrequesting direct deposit are asked some additional information about the bank accountto which refunds are to be deposited, and taxpayers must now enter only whole dollaramounts on income tax forms (nothing major here – I have never used cents ontax returns, except for some dependent returns).
Thereare a couple of new tax credits for 2012, including a “Beer Production Credit”.  Too bad there is not a “Beer ConsumptionCredit”.
The2012 NJ returns are not yet available.  Iwill let you know when they are.

MY BEST TAX ADVICE

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 I am finishing up a new report on MY BEST TAX ADVICE. iT will be ready in early January.

This report will be “chock-a-block” with the best tax planning and advice I have accumulated from 40 years as a professional 1040 preparer, geared toward the average middle-class taxpayer.

While, as I said above, it will not be available until January, I am making a special “pre-publication” offer –

For all orders postmarked by December 31, 2012 the price for this report, delivered as an email “pdf” attachment, is only $3.95! And I will include as a special gift my compilation of Schedule A Forms, Schedules, and Worksheets (current price for this compilation = $3.00)!
The cost for this report will be at least $4.95 in 2013, and this price will NOT include the Schedule A forms package.
Mail your check or money order for $3.95 (payable to Taxes and Accounting, Inc) and your email address to -

MY BEST TAX ADVICE
TAXES AND ACCOUNTING, INC
POST OFFICE BOX A
HAWLEY PA 18428TTFN

8 Good Bookkeeping Practices!

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1. Open a specified business checking account2. Do not share funds.  Spending from the business account should befor business purposes and expenses only. Never deposit directly into yourpersonal bank accounts. 3. Hold on to ALL yourreceipts! 4. Submit the receipts for reimbursement so the company willhave a record of the expense if you must make purchases from a personal fund. 5. Be aware of the state and federal rules of your business’sentity type 0 sole proprietor, S-Corp, C-Corp, or LLC6. When contemplating adding another employee, verify and understandthe TRUE cost of the employee and your obligations for timely tax remittals asthe employer. 7. Employee taxes are not your money8. Sales tax funds should never be combined or incorporatedinto your operating capital or counted on for operating. This is not yourmoney. 
Got a QuickBooks Mess? Call the QuickBooksGal! 775-348-9225

Lotus Notes Out of Office Message Won't Disable or Enable

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If you are trying to go away on vacation  or leave the office for an extended period of time with no access to email, you will definitely want to enable your away message on Lotus Notes Mail to indicate you are not available via email. Here's a post to learn how to put your out of message on if you don't know how.

Conversely if yo have returned to the office you want to be sure you disable your out of office message so that people know you are back. 


Let's make sure you are disabling properly before we look at another way to fix your problem. To Disable, first be sure you are in any screen that allows the “Tools” button to show in the top right corner of your Lotus Notes screen (inbox, send, junk mail, trash, etc views will all allow you to see the “Tools” button)Click the “Tools” button


In the drop down menu that appears select “Out of Office”The window that appears should read “Enabled”at the top. If so, look to the lower right of that window and select“Disabled”Another window will appear that will ask you if you are sure you want to disable your vacation / away message. Click yes and you are all set.

OK… now, what is probably happening, the whole reason you are reading this article, is that your vacation message is not turning off (ie it isn't disabling).  In other words, if you go back into tools-out of office again, it still says “Enabled” This is a problem since people still think you are still away from work when you really are. (The opposite, of course, is true if you are still getting the “Disabled” message but want to “Enable”)

Chances are you are already getting warning messages about your lotus running out of file space / memory. This is what is preventing your from turning on and off your away message.

To remedy, delete all of the emails (sent, inbox, junk, trash) that you no longer need. If a particular email is taking up a large amount of memory and you still need it, consider saving it to your hard drive, network, CD, etc, etc first before deleting  You want to get rid of as much mail as possible.  Essentially, your Lotus Notes file space is so full that even a simple action like disabling or enabling the out of office message will not save.

You might need to contact your system administrator to determine how much mail you need to delete or just wing it and get rid of as much as you  can starting with the largest sized files.  Here are some great tips on deleting excess mail from Lotus

Keep deleting and then trying to enable  / disable (don't forget to empty your 'trash' bin and junk mail). If it isn't enabling / disabling, delete some more.

Hope that helps! Thanks for reading!

GIT 'ER DONE!

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Itis almost December.  When dealing withthe potential “fiscal cliff”, now is not the time to consider long-termissues. 
Thefirst, and most important, thing to do ASAP is to extend the AMT patch throughthe end of 2012 (or, more better, through the end of 2013) so that theprocessing of 2012 tax returns and refunds are not delayed, and middle classtaxpayers are not hit with possible tax increases of between $3,000 and $4,000.
Thesecond thing to do is to extend all of the various tax benefits that willexpire on December 31, 2012, for one more year (through the end of 2013), andperhaps also the various popular “extenders” that expired on 12/31/11 alongwith the AMT patch (except for the 2% Social Security reduction).  The reason for doing this is so that we do notbegin 2013 with uncertainty concerning proper withholding.    
Thetime for considering serious long-term tax reform is January 2013, when the newCongress (which is really not that new) convenes.  This is when legislators should beconsidering whether to do away with or limit various tax loopholes andexpenditures, and whether to raise or lower tax rates – while there is almost afull year before any tax legislation must be passed (not that they should waituntil the last minute, as has become the custom).
Congresshas wasted away 2012, and must be made aware that their actions, or ratherinactions, have consequences.  They must putaside ridiculous partisan battling and consider the American people for achange.
TTFN 

DAMNED IF THEY DO AND DAMNED IF THEY DON'T

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Itis December already and there is no progress in Washington on “taxmegeddon”.
If(or more likely when) BO and the idiots in Congress fail to act on the “fiscalcliff” issues before the end of 2012, what is the IRS going to do regardingwithholding tables for 2013?
Ifthe Service follows “current” law, federal income tax withholding will substantiallyincrease for many, if not most, employees, as the so-called “Bush tax cuts”will have expired on December 31, 2012, and everything will go back to pre-Bushrules.  If the idiots in Washingtoneventually pass retroactive extensions of the expiring breaks, the IRS willneed to revise the withholding tables, as will software companies, andwithholding will be totally FU-ed for an extended period of time, resulting inlower pay checks for almost all employees for a couple of months.
Ifthe Service assumes the idiots in Washington will eventually pass retroactiveextensions and does not change the federal withholding tables, keeping everythingthe same as 2012 or with some inflation adjustments, and the idiots inWashington do nothing, the IRS will need to revise the withholding tables, aswill software companies, and withholding will be totally FU-ed for an extendedperiod of time, resulting in many employees being under-withheld for the yearand owing tax when filing their 2013 returns.
Unfortunatelyit is we taxpayers, not the IRS or the idiots in Washington, who may be damnedif they do and damned if they don’t.
Wemust hope that whatever assumption the IRS uses to determine federal income taxwithholding effective January 1, 2013 turns out to be correct. 
TTFN 

DAMNED IF THEY DO AND DAMNED IF THEY DON'T

To contact us Click HERE

Itis December already and there is no progress in Washington on “taxmegeddon”.
If(or more likely when) BO and the idiots in Congress fail to act on the “fiscalcliff” issues before the end of 2012, what is the IRS going to do regardingwithholding tables for 2013?
Ifthe Service follows “current” law, federal income tax withholding will substantiallyincrease for many, if not most, employees, as the so-called “Bush tax cuts”will have expired on December 31, 2012, and everything will go back to pre-Bushrules.  If the idiots in Washingtoneventually pass retroactive extensions of the expiring breaks, the IRS willneed to revise the withholding tables, as will software companies, andwithholding will be totally FU-ed for an extended period of time, resulting inlower pay checks for almost all employees for a couple of months.
Ifthe Service assumes the idiots in Washington will eventually pass retroactiveextensions and does not change the federal withholding tables, keeping everythingthe same as 2012 or with some inflation adjustments, and the idiots inWashington do nothing, the IRS will need to revise the withholding tables, aswill software companies, and withholding will be totally FU-ed for an extendedperiod of time, resulting in many employees being under-withheld for the yearand owing tax when filing their 2013 returns.
Unfortunatelyit is we taxpayers, not the IRS or the idiots in Washington, who may be damnedif they do and damned if they don’t.
Wemust hope that whatever assumption the IRS uses to determine federal income taxwithholding effective January 1, 2013 turns out to be correct. 
TTFN 

Lotus Notes Out of Office Message Won't Disable or Enable

To contact us Click HERE
If you are trying to go away on vacation  or leave the office for an extended period of time with no access to email, you will definitely want to enable your away message on Lotus Notes Mail to indicate you are not available via email. Here's a post to learn how to put your out of message on if you don't know how.

Conversely if yo have returned to the office you want to be sure you disable your out of office message so that people know you are back. 


Let's make sure you are disabling properly before we look at another way to fix your problem. To Disable, first be sure you are in any screen that allows the “Tools” button to show in the top right corner of your Lotus Notes screen (inbox, send, junk mail, trash, etc views will all allow you to see the “Tools” button)Click the “Tools” button


In the drop down menu that appears select “Out of Office”The window that appears should read “Enabled”at the top. If so, look to the lower right of that window and select“Disabled”Another window will appear that will ask you if you are sure you want to disable your vacation / away message. Click yes and you are all set.

OK… now, what is probably happening, the whole reason you are reading this article, is that your vacation message is not turning off (ie it isn't disabling).  In other words, if you go back into tools-out of office again, it still says “Enabled” This is a problem since people still think you are still away from work when you really are. (The opposite, of course, is true if you are still getting the “Disabled” message but want to “Enable”)

Chances are you are already getting warning messages about your lotus running out of file space / memory. This is what is preventing your from turning on and off your away message.

To remedy, delete all of the emails (sent, inbox, junk, trash) that you no longer need. If a particular email is taking up a large amount of memory and you still need it, consider saving it to your hard drive, network, CD, etc, etc first before deleting  You want to get rid of as much mail as possible.  Essentially, your Lotus Notes file space is so full that even a simple action like disabling or enabling the out of office message will not save.

You might need to contact your system administrator to determine how much mail you need to delete or just wing it and get rid of as much as you  can starting with the largest sized files.  Here are some great tips on deleting excess mail from Lotus

Keep deleting and then trying to enable  / disable (don't forget to empty your 'trash' bin and junk mail). If it isn't enabling / disabling, delete some more.

Hope that helps! Thanks for reading!