All income resulting from a 2011 conversion must be included in that year’s return. If the conversion was made in 2010, half of the resulting income must be reported in 2011 and the balance in 2012.
Taxpayers who must repay the credit may be able to do so without using Form 5405.
The “25(C)” credit for energy-efficient improvements has been extended, vut the amount of the credit has been reduced to a maximum of $500 per taxpayer per lifetime. Taxpayers who took the maximum $1,500 credit in 2010 are not eligible.
The mailing address for paper returns may have changed because the IRS has changed the filing locations for several regions. Taxpayers are advised by the IRS to read the “Where Do You File?” page at the end of the 1040 instruction booklet.
For 2011, the additional tax on health-savings account and Archer medical savings account distributions not used for qualified medical expenses has increased to 29% (up from 10% for HSAs and 15% for Archer MSAs). Also, starting in 2011, only prescribed drugs and insulin are considered qualified medical expenses.
Beginning after March 18, 2010, certain taxpayers may have to file the new Form 8938 with their tax returns. Form 8938 is used to report the ownership of specified foreign financial assets (including any financial accounts maintained by a foreign financial institution) if the total value exceeds a specific threshold. The threshold amount varies depending…Details
To claim the first-time home-buyer credit for 2011, a taxpayer (or their spouse, if married) must have been “a member of the uniformed services or Foreign Service, or an employee of the intelligence community on qualified official extended duty outside the United States for at least 90 days during the period beginning after Dec 31,…Details
For individuals who died after 2010, the federal estate tax provides a $5 million exemption and a maximum 35% tax rate. These estate tax rules are scheduled to end this year.
Taxpayers who rolled over an amount from a 401(k) or 403(b) plan to a designated Roth account during 2010 and did not elect to report the taxable amount on a 2010 return must report half of the 2011 return and the rest on the 2012 return.
Who is out there to get your money? Anyone that can get you to fall for one of the “Dirty Dozen Tax Scams” according to the Internal Revenue Service. The schemes can be anything from identity theft to tax return preparer fraud. You as a taxpayer must protect yourself by being in the know of…Details