Category Archive: Tax News

Oct 21

Social Security Tax increase set for 2012

2012 Social Security Wage Base: The social security wage base will increase from $106,800 in 2011 to $110,100 in 2012. As in prior years, there is no limit to the wages subject to the Medicare tax, so all covered wages are subject to the 1.45% tax. The FICA tax rate, which is the combined social …

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Jun 24

IRS Increases Mileage Rate to 55.5 Cents per Mile for second half of 2011

IRS Increases Mileage Rate to 55.5 Cents per Mile IR-2011-69, June 23, 2011 WASHINGTON — The Internal Revenue Service today announced an increase in the optional standard mileage rates for the final six months of 2011. Taxpayers may use the optional standard rates to calculate the deductible costs of operating an automobile for business and …

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Mar 01

IRS Has $1.1 Billion for People Who Have Not Filed a 2007 Income Tax Return

IRS-2011-21, Feb. 28, 2011 WASHINGTON — Refunds totaling more than $1.1 billion may be waiting for nearly 1.1 million people who did not file a federal income tax return for 2007, the Internal Revenue Service announced today. However, to collect the money, a return for 2007 must be filed with the IRS no later than …

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Feb 23

IRA converters must decide: Pay taxes now or later?

Your Money By Sandra Block, USA TODAY Ordinarily, taxpayers who convert a traditional individual retirement account to a Roth IRA must also pay up on Tax Day. In order to shelter future IRA earnings from taxes — the main reason most people convert to a Roth — you must first pay taxes on any pretax …

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Feb 08

Tax basis of assets inherited from estate of decedent, who died in 2010.

1. Congress in 2010 revived the estate tax retroactively for 2010 with a $5,000,000 exemption and a 35% rate. 2. For estates of $5,000,000 or less, Congress restored the use of a stepped-up basis (allowing heirs to use the basis at the date of death or the alternative valuation date six months later) to inherited …

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Feb 08

Seniors who received $250 rebate for being in the doughnut hole must reduce their medical expenses by it.

The rebate should be treated as a reimbursement of medical expenses. Therefore it must reduce claimed medical expenses by $250.00 before application of the 7.5% of AGI offset.