2013 Tax Season Updates

posted in: Tax Articles, Taxes

Dear Clients,

Whew!  I think that we can breathe a sigh of relief as Congress finally made some last minute decisions which, for the most part, continue our tax status quo and the majority of the tax credits and deductions that we have enjoyed these past few years. These changes, although made late, will not delay the filing season for most taxpayers.  Let me help you make this tax filing season as pain-free as possible.

Near the end of January, you should be receiving the bulk of your tax statements from employers, clients, retirement accounts, mortgage companies etc.  Watch for these and keep them together.  You will use these documents to prepare your “tax organizer”, (attached) and I will also need these documents to prepare your return.

As in years past I have attached to this email a resource to help you gather the needed information and compile it prior to your nyc tax prep for businesses. This is a much more in-depth organizer than I have used before and I think it will help us both to ensure that I can prepare for you the very best return possible.  (Please be patient with how detailed it is and feel free to skip the sections that don’t apply to your situation.)  The other thing I like about this organizer is that you can type in your information.  After it is filled out, you can either save the document and email it back to me, print it and fax it to 801-868-3000, or drop it off at my office.  Please note that if I have already prepared past years’ returns for you, you don’t need to fill in some of the personal info, unless there has been a change during the year.  This includes information on your dependents, again, unless there has been a change during 2012. Please do include your name so that I can make sure I know whose organizer I am working with in the case that it is faxed or dropped off.

Just in case you are interested, I have included a list of some of the changes made by Congress in early January that will affect many of us.

  • Be aware that the IRS turn-around time for refunds is much delayed this year. Plan on 21-75 days in some cases.  I know-sad isn’t it!  What this means is, don’t spend it until you see it in your account.  Let’s get your return prepared and filed as soon as possible so the clock starts sooner rather than later.
  • Exemption increase: The amount you can deduct for each personal exemption has increased from $3,700 to $3,800 for 2012.
  • If you qualify for Earned Income Credit, you will be required to sign additional due diligence forms and be prepared to produce some further IRS-outlined documentation for our records.
  • Your tax return is due Tuesday, April 15, 2013.  As always we can file a 6 month extension but that doesn’t extend the due date of taxes owing.  Please let me know if you will need to file an extension for whatever reason (waiting on K-1’s etc.) and I will get that prepared and filed for you.
  • The following provisions had expired in 2011 and on January 1st were reinstated retro-active for 2012: A deduction for mortgage insurance premiums, tax-free IRA distributions for charity, $4000 tuition & fees deduction, an option to deduct state and local sales tax vs. state tax withheld and the $250 deduction for K-12 classroom educators.
  • Residential Energy Tax Credits have been extended into 2013, however, much of the benefit has been stripped away. The existing credit limit is 10% of  “home energy efficient improvements” (not including the cost of installation) with a lifetime limit of $500.  Essentially this is saying that if you have ever claimed the credit (for exterior doors, windows, insulation, heating and/or cooling systems or heat-resistant roofs) you have most likely met your limit and won’t qualify for an additional credit in 2012. But as always, we can discuss how this affects you personally and then we will take it from there.
  • You may have already noticed that your first paycheck in 2013 was lower.  This is because the 2% payroll tax holiday that we have enjoyed for the past couple of years has ended.  As of 2013 your portion of Social Security is back up to 6.2% from 4.2%.  Self-employed individuals will need to plan on the Social Security portion of the self-employment tax being 12.4%.
  • One final change to be aware of in 2013 is the Additional Medicare Tax which will affect taxpayers with wages or compensation above the threshold of $200,000 annually ($250,000 MFJ).  If you qualify for this tax, the rate is 0.9 percent and will be withheld through payroll when any individual reaches the threshold.  Because a single employer has no way of determining if the household income has reached the threshold, there may be some portion of the Additional Medicare Tax owing when the return is prepared and filed.  If you think that you fall into this category, you can always request that your employer withhold additional taxes to cover this gap.

Again this year, please note that I have a locking drop box on the porch by my front door. I have intentionally chosen to not label it in an effort to further protect its contents. I hope that between the convenience of dropping off documents whenever you want, scanning and emailing them to me, or faxing them, I will be able to get right to work on your return. I need to have your organizer and the supporting documents at least three business days prior to our appointment so that I can spend most of the time that we have together reviewing your return with you, and determining if there are additional deductions for which you qualify.

Please call (801.473.1500) or email me (cardtax@gmail.com) with any questions that you might have and so that I can get you on my schedule. Together we can face this year’s filing with Peace of Mind.

I look forward to talking with you soon,

 

Jennifer L. Card,  E.A.

Card & Company Financial LLC

“Peace of mind with your Taxes.”

 

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