Thursday, February 23, 2012

VOW to Hire Heroes Act expanded the WOTC

Under a special rule included in a new IRS notice, employers have until June 19, 2012, to complete and file this newly-revised form for veterans hired on or after Nov. 22, 2011, and before May 22, 2012. The standard rule (file form 8850 with with your respective state workforce agency within 28 days after the eligible worker begins work) will again apply to eligible veterans hired on or after May 22, 2012.


Employers that hire veterans who have been looking for employment for more than six months may be eligible for a maximum $5,600 credit per employee (Returning Heroes Tax Credit); employers that hire veterans who have been looking for employment for less than six months may be eligible for a credit of up to $2,400 per employee. Employers that hire veterans with service-connected disabilities who have been looking for employment for more than six months may be eligible for a credit of up to $9,600 per employee (Wounded Warriors Tax Credit).

Tuesday, February 21, 2012

New for c-corps

C-corps with revenues of $500k+ must disclose officer compensationon the new form 1125-E for tax years beginning in 2011.

The enhanced deduction for charitable contributions of qualified food inventory,  the enhanced deduction for corporate charitable contributions of computers, and the enhanced deduction for corporate charitable contributions of qualified book inventory to public schools expired 12/31/11.

Tuesday, February 14, 2012

New investment advisor fee disclosure is coming

Effective July 1 covered service providers (such as investment advisors) that expect to receive at least $1,000 in compensation for services to a covered plan to more thoroughly and clearly disclose their total compensation. If fees are based on revenue numbers which are unknoen until the year is over, the rules state that a record keeper can provide a reasonable estimate accompanied by an explanation of how the cost was calculated.

Thursday, February 9, 2012

Exempt Organizations News

Request for Miscellaneous Determination


The new form 8940 can be used to make a request for a determination that an organization is exempt from the requirement of filing a 990 form, among other more obscure requests. See section 8d at the link below:

http://www.irs.gov/instructions/i8940/ch02.html

Select Check

This is an on-line search tool that allows users to select an exempt organization and check certain information about its federal tax status and filings. It consolidates three former search sites into one, providing expanded search capability and a more efficient way to search for organizations that:

• Are eligible to receive tax-deductible charitable contributions (Publication 78 data),

• Have had their tax-exempt status automatically revoked because they have not filed Form 990 series returns or notices annually as required for three consecutive years (Auto-Revocation List), or

• Have filed a Form 990-N annual electronic notice (e-Postcard).

Beginning in February 2012, Exempt Organizations Select Check data will generally be updated on the third Monday of each month for automatically revoked organizations and organizations eligible to receive deductible contributions, and weekly for Form 990-N (e-Postcard) filings. In addition to searching for a particular organization, users may download a complete list of each of the three types of organizations through Exempt Organizations Select Check

Tuesday, February 7, 2012

New Hire Retention Credit

Employers may claim the credit for each retained worker. A retained worker is a qualified employee (see below) who remains an employee for at least 52 consecutive weeks, and whose wages (as defined for income tax withholding purposes) for the last 26 weeks equal at least 80% of the wages for the first 26 weeks. The amount of the credit is the lesser of $1,000 or 6.2% of wages (as defined for income tax withholding purposes) paid by the employer to the retained worker during the 52 consecutive week period.


A “qualified employee” is an employee who:

• Begins employment with you after February 3, 2010, and before January 1, 2011;

• Certifies by signed affidavit (Form W-11 or similar statement) under penalties of perjury, that he or she has not been employed for more than 40 hours during the 60-day period ending on the date the employee begins employment with you;

• Is not employed by you to replace another employee unless the other employee separated from employment

• Is not related to you. An employee is related to you if he or she is your child or a descendent of your child, your sibling or stepsibling, your parent or an ancestor of your parent, your stepparent, your niece or nephew, your aunt or uncle, or your in-law. An employee is also related to you if he or she is related to anyone who owns more than 50% of your outstanding stock or capital and profits interest or is your dependent or a dependent of anyone who owns more than 50% of your outstanding stock or capital and profits interest.

The credit may be claimed for a retained worker for the first taxable year ending after March 18, 2010 for which the retained worker satisfies the 52 consecutive week requirement. Calendar year taxpayers are first eligible to claim the credit on their 2011 tax returns due April 15, 2012. For fiscal year filers, the earliest date to file a return claiming the credit would be fiscal years ending after February 3, 2011.

Claim the credit using the below form:

http://www.irs.gov/pub/irs-pdf/f5884b.pdf

Wednesday, February 1, 2012

2011 Status of Tax Credits Rewarding Taxpayers for Energy Efficiency

Few credits have been more confusing than the on-again, off-again credits rewarding taxpayers for energy efficient improvements to their residences: the nonbusiness energy property credit and the residential energy efficient property credit.


The nonbusiness energy property credit expired after 12/31/11. For property placed in service in 2011 there are new limitations. The credit now has a lifetime limit of $500, of which only $200 may be used for windows. Subject to the lifetime limits, only 10% of qualified energy efficiency improvements is allowed and the residential energy property costs are limited to $300 for energy efficient building property, $150 for any qualified natural gas, propane, or oil furnace or hot water boiler, and $50 for any advanced main air circulating fan. Also new, include any labor costs properly allocable to the onsite preparation, assembly, or original installation of the energy property.

The residential energy efficient property credit is scheduled to expire after December 31, 2016. Both credits are claimed on Form 5695, Residential Energy Credits. This is the credit of 30% of your costs of qualified solar electric property, solar water heating property, small wind energy property, geothermal heat pump property, and fuel cell property. Include any labor costs properly allocable to the onsite preparation, assembly, or original installation of the residential energy efficient property and for piping or wiring to interconnect such property to the home. This credit remains relatively unchanged from last year.