Income Tax Due Date

Just a warning: personal taxes (1040, 1040A and 1040EZ) are due October 15 if you filed an extension on or before April 15 of this year! Let us know if you need help.

IRS wants to inform you about benefits of the Recovery Act!

IRS Announces New Materials Available to Promote Awareness of Recovery Act Tax Benefits
WASHINGTON — As part of a larger effort to increase the awareness and use of tax benefits available through the American Recovery and Reinvestment Act (Recovery Act), the Internal Revenue Service today announced the availability of a vast array of products that help explain several tax benefits currently available to American Families.
With time running out to qualify for some of the Recovery benefits, the IRS has unveiled new YouTube videos, radio public service announcements (PSAs) and multi-lingual informational flyers that provide basic information for taxpayers. The items are available on IRS.gov for partner groups, the media, web sites and other organizations whose audience could benefit from the new tax changes.
These products are in addition to earlier IRS efforts on YouTube (www.youtube.com/irsvideos) and iTunes to increase public awareness about the tax credits. The IRS.gov official web site also contains links and complete information about ARRA at www.irs.gov/recovery. The PSAs are in English and Spanish in either 30-second or 60-second formats. The flyers and posters are in English, Spanish, Chinese, Korean, Russian and Vietnamese.
Topics covered include:
• The first-time homebuyer credit which provides a maximum $8,000 tax credit to people who meet eligibility requirements and complete the purchase of their homes before December 1;
• The American Opportunity Credit expands education tax credits to $2,500 for tuition and a change in 529 plans allows for the purchase of computers for college use;
• The energy credit expands to a maximum of $1,500 for certain energy-saving upgrades;
• A new deduction for the sales or excises taxes paid on the purchase price of new vehicles;
• The Making Work Pay tax credit, which many American workers received in April through reduced tax withholding in their paychecks. The Making Work Pay credit is $400 for single taxpayers and $800 for married taxpayers who meet certain income guidelines. However, some people, such as married spouses, workers with two jobs, pensioners, some Social Security recipients and dependents, should check their tax withholding to ensure they are not having too little withheld.
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Performance of Franz Kafka’s THE TRIAL

NEAT PLAY AT IMAGINON

Ever try to read The Trial by Franz Kafka but were befuddled?  Now see the play and get it!  By a terrific group of teens at a wonderful facility here in Charlotte!  The Ensemble Company of Children’s Theatre of Charlotte will perform under the direction of Mark Sutton:

 http://www.ctcharlotte.org/store/index.php?catid=807

Cool fact:  my son Andrew is the lead.

Great Benefit Functions

GREAT CAUSE:  Several terrific events in support of Charlotte’s UNITED FAMILY SERVICES – The 5K Run for Peace at Home http://www.run.charlottepeaceathome.com/index.html is Saturday May 30, and there is even a Rock for Peace concert that night http://tinyurl.com/c44kq5   . Patti is serving on the Board and they are still looking for sponsors for this great event!  Please contact us or Zac Reilly zac.reilly@charlottepeaceathome.com if you are interested. 

Also there is a Men for Change “Meet Me for Breakfast” June 2 to benefit UFS  http://www.unitedfamilyservices.org/menforchange.html .  If interested, contact Lamar Wilson at lamar.wilson@telecomop.com .

 

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More on 2009 American Recovery & Reinvestment Act

goo stuff direct from the IRS:

http://www.irs.gov/newsroom/article/0,,id=204335,00.html

Why use a CPA?

From the NC Association of CPAs:

 

— CPAs are honest, skilled, and competent tax professionals.

·         — CPAs have college degrees; they pass rigorous exams; they are committed to continuing professional education; and they are certified, licensed, and regulated by state boards of accountancy.

·        — CPAs are required to pass a thorough professional exam after they complete their college education in order to be licensed by the state in which they practice. After they are licensed, mandatory continuing professional education requirements ensure that CPAs are current with regulatory and legal changes.

·        — Members of the NCACPA are required to adhere to strict professional ethics standards. Additional ethics rules apply to CPAs who are tax practitioners.

·         — If the IRS raises a question about a tax return, only CPAs, attorneys, and enrolled agents are authorized to represent taxpayers before the IRS.

·         — CPA tax professionals often know a lot about your personal situation, so the continuity of service you receive from a CPA may be an important factor to consider. CPAs are business people in the community who will be there for taxpayers year after year.

·        — The AICPA and NCACPA are committed to ensuring that CPAs work in the public interest by providing the resources to best hone skills of CPA tax professionals and by regulating unacceptable professional conduct while advocating on behalf of the public and members an effective and efficient system of taxation.

Evolve Management, LLC Offers Value Driven Leadership Service to Business Owners and Chief Executives

Evolve Management, LLC Offers Value Driven Leadership Service to Business Owners and Chief Executives http://news.prnewswire.com/ViewContent.aspx?ACCT=109&STORY=/www/story/02-24-2009/0004977378&EDATE=

Company initiates operations; offers highly skilled team of experienced executives for on-call, part-time, or interim corporate management. CHARLOTTE, N.C., Feb. 24 /PRNewswire/ — Evolve Management opened its doors this week, enabling organizations to evolve themselves to a higher level using a new, unique, and innovative approach to leveraging senior management. Evolve provides businesses with on-call, part-time, and interim senior leadership, as well as board of advisors members from a team of executives that have come together to help business owners and CEOs effect vital change. The firm also assists private equity, venture capital, and angel investment firms, who are focused on insuring their corporate investments are performing at a high level with CXOs that are available when and where they need them. Evolve’s deeply talented, experienced, and diverse pool of CXOs or “Evolve Associates,” has years of experience in managing the six core organizational disciplines, including: -- Finance -- Human Resources -- Information Technology -- Legal Affairs -- Operations, and -- Sales & Marketing “Evolve assists businesses that may not have the need nor the budget for full-time senior executives in each organizational discipline,” states Jay Rao, Evolve’s CEO. “Senior leadership skill gaps are a critical problem for small to medium-sized organizations. While most company executives might be experts on their products, service offerings, or industry, they might not be experienced in other critical aspects of running a business. This lack of experience often leads to poor corporate value and performance especially in the areas of growth, efficiency, and productivity. That is where Evolve comes into the picture.” Rao goes on to say that “Evolve CXOs are an alternative to full-time executive staff. We, in essence, are an entrepreneur’s management team only in a much more effective and efficient manner. The model works quite well in today’s tough economic times whether you are a startup, established organization, or an organization in transition.” Evolve continues to steadily build its Associate Program of CXO talent. Ideal candidates have over 20 years of industry experience and are either looking for full time work with one or many clients, part time work, or Board of Advisors seats. For more information about Evolve Management, please visit www.EvolveYour.Biz or contact us at either info@EvolveYour.Biz or 704-560- 1082. Media Contact: Jay Rao, CEO jrao@EvolveYour.Biz 704-560-1082

American Recovery and Reinvestment Act of 2009

The American Recovery and Reinvestment Act of 2009 (commonly referred to as the Recovery Act), which was signed into law on Feb. 17, 2009, makes a number of beneficial tax changes for individuals. However, most of them are temporary in nature, that is, unless extended by future legislation, they apply for 2009 only or in some cases for 2009 and 2010. Here’s a review of the more widely applicable provisions that could have an impact on you and your family. New Making Work Pay Credit. Individuals who work generally get a credit of up to $400 ($800 for joint filers). The credit is refundable, meaning you get it even if you owe no income tax. This change applies for 2009 and 2010. The credit is the lesser of 6.2% of your earned income or $400 ($800 on a joint return). The credit is phased out for joint filers with modified adjusted gross income between $150,000 and $190,000 and other taxpayers with modified AGI between $75,000 and $95,000. You won’t be getting a separate check from the IRS, as you did with last year’s Stimulus payment. Rather, your employer will automatically adjust your withholding so that you will get a little more money in each paycheck. If you have multiple jobs, you may have to adjust your withholding so that too much is not taken out. If you are self-employed, you can effectively receive the credit in advance by reducing your estimated tax payments. One-time $250 payment or credit for others. The Recovery Act provides a one-time payment of $250 in 2009 to retirees, disabled individuals and SSI recipients receiving benefits from the Social Security Administration, Railroad Retirement beneficiaries, and disabled veterans receiving benefits from the U.S. Department of Veterans Affairs. It also provides a one-time refundable tax credit of $250 in 2009 to certain government retirees who are not eligible for Social Security benefits. The Making Work Payment credit is reduced by any $250 payment or credit received. New sales tax deduction for vehicle purchases. For 2009, there is a new deduction for state and local sales and excise taxes paid on the purchase of new cars, light trucks, motor homes and motorcycles after Feb. 16, 2009 and before Jan. 1, 2010. The deduction generally is available regardless of whether you itemize deductions on Schedule A or claim the standard deduction. The deduction is limited to the tax on up to $49,500 of the purchase price of an eligible motor vehicle. The deduction is phased out for joint filers with modified adjusted gross income between $250,000 and $260,000 and other taxpayers with modified AGI between $125,000 and $135,000. If you itemize and choose the option to deduct state sales taxes in lieu of state income taxes, you don’t get the new deduction. This prevents you from getting a double deduction for the sales taxes on the vehicle but it also involves some tricky planning considerations because different rules apply to the optional deduction and the new deduction. For example, the new deduction but not the optional deduction is allowed against the alternative minimum tax. Additionally, the optional deduction is subject to a limitation that caps the deduction for sales tax on a motor vehicle to the general sales tax rate. Improved first-time homebuyer credit. Last year’s Housing Act included a refundable tax credit for first-time homebuyers equal to the lesser of 10% of the purchase price or $7,500 for qualifying purchases after Apr. 1, 2008 and before July 1, 2009. The credit is essentially an interest-free loan because it has to be paid back to the government over 15 years. The Recovery Act has improved the credit for 2009 purchases by (1) eliminating the requirement to pay it back (subject to exceptions), (2) increasing the maximum credit to $8,000, and (3) making it available for purchases through November 2009. You can treat a 2009 purchase as having been made on Dec. 31, 2008 and thus get an immediate refund when you file your 2008 taxes by the Apr. 15, 2009 filing deadline. Even if you have already filed your 2008 taxes, you can file an amended 2008 return to get the credit for a 2009 purchase. You are considered a first-time homebuyer if you or (or your spouse, if married) had no present ownership interest in a principal residence in the U.S. during the 3-year period before the purchase of the home to which the credit applies. The first time homebuyer credit, whether claimed in 2008 or 2009, phases out for individual taxpayers with modified adjusted gross income between $75,000 and $95,000 ($150,000–$170,000 for joint filers). AMT relief. In general terms, to find out if you owe alternative minimum tax (AMT), you start with regular taxable income, modify it with various adjustments and preferences (such as addbacks for property and income tax deductions and dependency exemptions), and then subtract an exemption amount (which phases out at higher levels of income). The result is multiplied by an AMT tax rate of 26% or 28% to arrive at the tentative minimum tax. You pay the AMT only if the tentative minimum tax exceeds your regular tax bill. Although it was originally enacted to make sure that wealthy individuals did not escape paying taxes, the AMT has wound up ensnaring many middle-income taxpayers. Exemption amounts were scheduled to drop and fewer tax credits were to be available to offset AMT for 2009. The Recovery Act provides AMT relief for 2009 by (1) increasing the exemption amounts above last year’s levels and (2) allowing nonrefundable credits to offset AMT as well as regular tax. College tax breaks. The Recovery Act expands tax breaks for individuals seeking a college education. For 2009 and 2010, it gives taxpayers a new “American Opportunity” tax credit of up to $2,500 of the cost of tuition and related expenses paid during the tax year. You receive a tax credit based on 100% of the first $2,000 of tuition and related expenses (including books) paid during the tax year and 25% of the next $2,000 of tuition and related expenses paid during the tax year. The credit is available for the first four years of post-secondary education in a degree or certificate program. Forty percent of the credit is refundable. The credit is phased out for taxpayers with modified AGI between $80,000 and $90,000 ($160,000 and $180,000 for joint filers). Section 529 Education Plans are tax-advantaged savings plans that can be used to pay qualified education expenses, including: tuition, room & board, mandatory fees and books. Under the Recovery Act, for 2009 and 2010, qualified education expenses under these plans include computer technology and equipment, as well as Internet access and related services. Tax break for the unemployed. Unemployment compensation benefits ordinarily are fully taxable. However, under the Recovery Act, an individual does not have to pay tax on up to $2,400 in unemployment benefits received in 2009. Limited subsidy for COBRA continuation coverage of unemployed workers. The Recovery Act provides a 65% subsidy for COBRA continuation premiums for up to 9 months for workers who have been involuntarily terminated, and for their families. This subsidy also applies to health care continuation coverage if required by states for small employers. To qualify for premium assistance, a worker must be involuntarily terminated between Sept. 1, 2008 and Dec. 31, 2009. Workers who were involuntarily terminated between Sept. 1, 2008 and Feb. 17, 2009, but failed to initially elect COBRA because it was unaffordable, must be given an additional 60 days to elect COBRA and receive the subsidy. The subsidy is not taxable when received, but higher income recipients—those with modified adjusted gross income above $125,000 ($250,000 for joint filers)—will have to pay back part or all of it at tax return time. Refundable child credit expanded. A taxpayer receives a $1,000 tax credit for each qualifying child under the age of 17. Before the Recovery Act, this credit was refundable only to a limited extent. The Recovery Act makes the child credit refundable to a much greater extent for 2009 and 2010. Bigger earned income tax credit (EITC). The Recovery Act makes various changes to the earned income tax credit for 2009 and 2010. These changes will result in a bigger EITC for some taxpayers. For example, in 2009, taxpayers with three or more qualifying children may claim a credit of 45% of earnings up to $12,570, resulting in a maximum credit of $5,656.50. Increased transit and vanpool transportation fringe benefits. For months beginning on or after Mar. 1, 2009 and before Jan. 1, 2011, the Recovery Act increases the monthly exclusion for employer-provided transit and vanpool benefits from $120 to $230. This figure is adjusted for inflation each year and could go up in 2010. Improved energy tax breaks. The Recovery Act includes a number of provisions that are designed to promote the creation and use of alternative forms of energy including these new or improved energy tax breaks for individuals: o The Recovery Act extends the tax credit for energy-efficient improvements to existing homes through 2010 and modifies it in various ways so that a larger credit is possible after 2008. o Under pre-Recovery Act law, individuals could claim a 30% tax credit for qualified solar water heating property (capped at $2,000), qualified small wind energy property (capped at $500 per kilowatt of capacity, up to $4,000), and qualified geothermal heat pumps (capped at $2,000). For tax years beginning after 2008, the Recovery Act removes these individual dollar caps. As a result, each of these types of improvements is eligible for an uncapped 30% credit. o The Recovery Act modifies and increases the existing new qualified plug-in electric drive vehicle credit. o For vehicles bought after Feb. 17, 2009 and before Jan. 1, 2012, the Recovery Act creates a new 10% nonrefundable personal credit for electric drive low-speed vehicles, motorcycles, and three-wheeled vehicles. o For property placed in service after Feb. 17, 2009 and before Jan. 1, 2012, the Recovery Act creates a new 10% credit, up to $4,000, for the cost of converting any motor vehicle into a qualified plug-in electric drive motor vehicle.

Announcement

I have the tremendous pleasure to announce that beginning January 2009, I have been joined in my practice by my new business partner, my wife, Patti LaPenna Clark.  Patti is a CPA specializing in income taxes for businesses and individuals.  She brings an extremely strong background and I am thrilled to have her as my new partner!  Call her up to say hello at 704-661-1169 or email her at Patti@LarryAClarkCPA.com

IRS Business Tax Calendar

This is a handy-dandy calendar of business related tax filings and due dates for 2009 direct from the IRS:

 

http://www.irs.gov/pub/irs-pdf/p1518.pdf