openPR Logo
Press release

11 Tips To Reduce Taxes Before April 15

02-08-2011 12:24 PM CET | Business, Economy, Finances, Banking & Insurance

Press release from: Carl Terzian Associates

/ PR Agency: Carl Terzian Associates
Los Angeles, Feb. 7, 2011 — Tax season has arrived and the Los Angeles office of Grant Thornton LLP wants to remind California taxpayers that there are still plenty of things they can do to manage their tax bill and avoid filing hassles.

“It’s unfortunate that so many people don’t think about their taxes at all until it’s time to fill out a return,” said Grant Thornton Tax Partner Don Dahl. “But luckily there are still plenty of last-minute strategies you can use to affect your 2010 tax return.”

The glut of tax changes over the last two year has opened up many opportunities, but taking advantage of all of them is only getting harder. Don’t panic. Grant Thornton is pleased to offer 11 tax tips that should answer some of the biggest questions taxpayers will have this filing season:

What’s new for 2010?

1. Self-employed health insurance costs deductible against self-employment tax. For 2010, self-employed individuals may deduct their health insurance costs against both income and self-employment taxes.

2. No itemized deduction or exemption phaseouts. Taxpayers with high incomes have suffered through phaseouts of their personal exemptions and itemized deductions in past years. These phaseouts are completely eliminated in 2010, so you can enjoy these tax benefits in full.

3. Homebuyer credit. Congress extended a tax credit for homebuyers in 2010 to include purchases made by Sept. 30, 2010, if a binding contract was in place by April 30, 2010. The credit offers up to $8,000 for “first-time homebuyers” who did not own a principal residence in the three years before the purchase or $6,500 for “long-time residents” who owned a home that was their principal residence for five of the eight years before the purchase. The credit begins to phase out at income levels of $125,000 for singles and $225,000 joint filers. The house can’t cost more than $800,000.

What can I do right now to affect my 2010 return?

4. Contribute to a traditional IRA. You can still get an above-the-line deduction for your 2010 return by contributing to a traditional Individual Retirement Account (IRA) now. This does not include a Roth Individual Retirement Account. You can make contributions that are deductible on your 2010 return any time before April 18, 2011 — and can even set up the account now if you don’t have one already. Contribution limits for 2010 are $5,000 plus a $1,000 catch up for those 50 and over, but contributions only offer deductions at income levels below $109,000 for joint filers and $66,000 for singles.

5. Reconsider a Roth IRA rollover. The $100,000 income limit on rollovers from an IRA or 401(k) to a Roth IRA disappeared in 2010. This type of rollover allows you to pay tax on the conversion in exchange for no taxes in the future (if withdrawals are made properly). A special provision allows you to pay the taxes on a 2010 conversion in equal installments in 2011 and 2012. If you converted to a Roth IRA last year, keep an eye on the account to see whether it decreases in value. If it does, you may want to unwind the conversion and then reconvert to a Roth IRA. By doing so, you will pay taxes on the lower value, which means the taxes due as a result of the conversion will be lower. You can unwind the conversion as late as the due date of your 2010 income tax return. Thus, if you extend your return, you will have until Oct. 17, 2011, to unwind the conversion. You can then convert again to a Roth IRA, as long as you wait at least 31 days after unwinding the initial conversion to do so.

6. Get your charitable house in order. A charitable cash contribution must be documented to be deductible. If you claim a charitable deduction of over $500 in donated property, you must attach Form 8283. If you are claiming a deduction of $250 or more for a car donation, you will need a contemporaneous written acknowledgement from the charity that includes a description of the car. Remember, you cannot deduct donations to individuals, social clubs, political groups or foreign organizations.

7. Consider filing electronically. Filing electronically will speed up your refund and can save you from simple mistakes. Before the IRS accepts an electronic return, it checks for several critical errors. The IRS gives you the chance to correct the problems before it accepts and processes your electronic return.

8. Check your numbers twice. Avoid math errors and make sure to get your Social Security numbers right. IRS computers automatically match all Social Security numbers and check for simple math mistakes. If you wrote down the wrong Social Security number for one of your dependents, the IRS will disallow the dependent, recalculate the return and usually send you a brand new tax bill. Millions of returns also generate math error notices that often come as unwelcome surprises to unsuspecting taxpayers. These problems can be a hassle to unwind.

9. Don’t miss the deadline for filing an extension. Don’t bury your head in the sand if you’re not going to get your return filed on time. Filing for an automatic extension with Form 4868 is painless and will spare you penalties for missing the deadline. But remember, extending the filing deadline does not extend the time for making a contribution to an IRA, and it does not extend the time for payment. By the filing deadline, you must have paid at least 90 percent of your 2010 tax liability through withholding, estimated payments and any payment made with your extension.
What should I start thinking about for 2011?

10. Recalculate your remodel. Lawmakers extended a tax credit for energy-efficient home improvements for 2011, but at a considerably less generous level. For 2011 you are only entitled to a 10 percent credit of up to $500 for installing energy-efficient property such as insulation, windows, roofs, fans, furnaces or water heaters (down from 30 percent and $1,500 in 2010). Don’t count on last year’s more generous tax credit when estimating your costs for a future remodel.

11. Payroll tax deduction. Lawmakers enacted a one-year reduction in the employee portion of the Social Security tax in 2011 from 6.2 percent to 4.2 percent. The reduction applies all the way up to the Social Security wage limit of $106,800 and reduces self-employment taxes from 15.3 percent to 13.3 percent. It does not affect the deduction for self-employment taxes. If you can afford it, consider using your tax savings to contribute to a tax-favored savings vehicle like a 401(k) retirement account or 529 education savings plan.

###

About Grant Thornton LLP
The people in the independent firms of Grant Thornton International Ltd provide personalized attention and the highest quality service to public and private clients in more than 100 countries. Grant Thornton LLP is the U.S. member firm of Grant Thornton International Ltd, one of the six global audit, tax and advisory organizations. Grant Thornton International Ltd and its member firms are not a worldwide partnership, as each member firm is a separate and distinct legal entity. In the U.S., visit Grant Thornton LLP at www.GrantThornton.com.

Tax Professional Standards Statement
This document supports Grant Thornton LLP’s marketing of professional services and is not written tax advice directed at the particular facts and circumstances of any person. If you are interested in the subject of this document, we encourage you to contact us or an independent tax advisor to discuss the potential application to your particular situation. Nothing herein shall be construed as imposing a limitation on any person from disclosing the tax treatment or tax structure of any matter addressed herein. To the extent this document may be considered to contain written tax advice, any written advice contained in, forwarded with, or attached to this document is not intended by Grant Thornton to be used, and cannot be used, by any person for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.

Taxes, April, Grant Thornton, 401(K), IRA, savings, self-employed, Los Angeles, filling

This release was published on openPR.

Permanent link to this press release:

Copy
Please set a link in the press area of your homepage to this press release on openPR. openPR disclaims liability for any content contained in this release.

You can edit or delete your press release 11 Tips To Reduce Taxes Before April 15 here

News-ID: 161558 • Views: 1334

More Releases from Carl Terzian Associates

Valensi Rose, PLC Attorney Michael Morris to Moderate Music Industry Updates at …
Los Angeles, CA – June 6, 2011– Attorney Michael Morris of Valensi Rose, PLC will moderate the 2012 California Entertainment Industry Conference’s “Music Industry Updates” portion of the daylong event. The Conference will highlight the path to fraud prevention, sports and sports media rights, trends in new media, music industry updates, copyright terminations, entertainment tax and current trends in film. The annual Entertainment Industry Conference is presented by the California
ISSA-LA President Dr. Stan Stahl Speaks On Preventing Cybercrime at The Californ …
Los Angeles, CA, June 4, 2012—Stan Stahl Ph.D, president of the Los Angeles chapter of the Information Systems Security Association (ISSA-LA) will be a featured speaker at the California Association of County Treasurers and Tax Collectors (CACTTC) on Wednesday, June 13 , 2012 at the Renaissance Hollywood Hotel in Hollywood. He will address the audience of elected or appointed County Treasurers and Tax Collectors within the State
Louis E. Kempinsky Joins Valensi Rose, PLC’s Growing Legal Practice
Los Angeles, CA, May 23,2012—Valensi Rose, PLC, a top Los Angeles law firm, welcomes Louis E. Kempinsky to its expanding practice. Mr. Kempinsky is a seasoned trial attorney specializing in business and commercial disputes. His practice encompasses trial and appellate work in Federal, State and Bankruptcy courts. Mr. Kempinsky has been lead counsel in numerous jury and non-jury trials involving a wide variety of substantive issues, including
Three-quarters of Financial Executives Received Salary Increases in 2011
Los Angeles, May 21, 2012 — Seventy-four percent of financial executives received an increase in their salary in the last year, compared to 66 percent in 2011 and 43 percent in 2010, according to the findings of an annual survey issued today by Grant Thornton LLP and Financial Executives Research Foundation (FERF). While the estimated average salary increase was four percent, versus the three percent last year, public companies were

All 5 Releases


More Releases for Grant

11-07-2017 | Sports
Bow Tie Strategies
Women Veteran’s Group Receives Grant
Final Salute Inc. has received a grant from the Joey Logano Foundation (JLF) to support its efforts in providing transitional housing, financial support, education, and other much needed services for homeless women veterans, many of whom are single mothers. Final Salute is the local grantee in the JLF Chasing Second Chances program, which makes grants to local charities along the NASCAR circuit. This generous grant ensures that Final Salute
Grant Helps Fund McKendree Mobile App
(LEBANON, IL, September 7, 2017) — A $60,000 grant from Campus Consortium will enable McKendree University to develop an official mobile app through the technology provider Unifyed. The grant will cover mobile app licensing and development costs. The new app will include public information such as campus news, emergency numbers, events social media, parking, dining, a directory, athletics and maps. It will also include the ability for students to register,
Rockland County YMCA receives grant
Rockland County YMCA Receives Grant to Offer Contact: Maire Brosnan Katavolos Rockland County YMCA 845-358-6608 MBrosnan@rockland ymca.org Enhance®Fitness, a Program that Treats Arthritis through Fun, Laughter and Friendship Program proven to reduce arthritis symptoms and increase physical function in a social atmosphere Nyack, NY, June 2017 –The Rockland County YMCA is the proud recipient of a grant from the NYS Alliance of YMCA's to expand their EnhanceFitness Program. The program is an evidence-based physical
Kepley BioSystems awarded prestigious NSF TECP Grant
Greensoboro, N.C., November 11, 2016 -- Kepley BioSystems (KBI) is pleased to announce being awarded a National Science Foundation (NSF) Technology Enhancement for Commercial Partnerships (TECP) grant to develop an automated manufacturing module for OrganoBait™. This $150,000 grant will help transform the KBI production scale from the laboratory to begin addressing its vast market potential. KBI is an academically inspired enterprise committed to the development and commercialization of a patent-pending,
Hillsides Children’s Library Receives Literacy Grant
(PASADENA, CA)— Hillsides, a Pasadena children’s charity, is a proud recipient of a $15,000 grant from the “Los Angeles Times Family Fund, a fund of the McCormick Foundation” in support of the charity’s Lynn Angell Memorial Children’s Library. The grant will help the children’s charity maintain a vibrant, well-stocked library that supports a wide range of literacy activities. Located on Hillsides’ main campus in Pasadena, the library serves children in Hillsides’
Campanella receives grant from Young Singers Foundation
Campanella Children’s Choir has been awarded the grant by Young Singers Foundation to attend Windy City Youth Choral Festival in Chicago in summer 2012. The grant money will help offset the cost of participation for Campanella choristers, expanding the festival educational opportunity beyond that of Heritage Festival, which the Campanella Children’s Choir will attend in April 2012. The fourth-annual Windy City Youth Choral Festival, June 28 – July 1, 2012