Want to lower your 2011 tax bill? The time for action is running
out, so consider these tax-savers now.
• You can choose to deduct sales taxes instead of local and state income
taxes. If you’re planning big ticket purchases (like a car or a boat), buy
before year-end to beef up your deductible amount of sales tax.
• If you’re a teacher, don’t overlook the deduction for up to $250 for
classroom supplies you purchase in 2011.
• Consider prepaying college tuition you’ll owe for the first semester of
2012. This year you can deduct up to $4,000 for higher education expenses.
Income limits apply.
• Max out your retirement plan contributions. You can set aside $5,000 in
an IRA ($6,000 if you’re 50 or older), $11,500 in a SIMPLE IRA ($14,000 if
you’re 50 or older), or $16,500 in a 401(k) plan ($22,000 if you’re 50 or
older).
• Establish a pension plan for your small business. You may qualify for a
tax credit of up to $500 in each of the plan’s first three years.
These possibilities for cutting your taxes are just the
starting point. Contact us at (219) 769-3616 or e-mail your
questions to tlynch@swartz-retson.com now for a review of
your 2011 tax situation and tax-saving suggestions that
will work best in your individual circumstances.
SWARTZ, RETSON & CO., P.C
Tuesday, December 6, 2011
Act soon to save taxes—2
Want to lower your 2011 tax bill? The time for action is running
out, so consider these tax-savers now.
• Need equipment for your business? Buy and place it in service by yearend
to qualify for up to $500,000 of first-year expensing or 100% bonus
depreciation.
• Review your investments and make your year-end sell decisions, whether
to rebalance your portfolio at the lowest tax cost or to offset gains and
losses.
• If you’re charity-minded, consider giving appreciated stock that you’ve
owned for over a year. You can generally deduct the fair market value and
pay no capital gains tax on the appreciation.
• Another charitable possibility for those over 70½: Make a direct donation
of up to $100,000 from your IRA to a charity. The donation counts as part
of your required minimum distribution but isn’t included in your taxable
income.
• Install energy-saving improvements (such as insulation, doors, and
windows) in your home, and you might qualify for a tax credit of up to
$500.
These possibilities for cutting your taxes are just the
starting point. Contact us at (219) 769-3616 or e-mail your
questions to tlynch@swartz-retson.com now for a review of
your 2011 tax situation and tax-saving suggestions that
will work best in your individual circumstances.
SWARTZ, RETSON & CO., P.C.
out, so consider these tax-savers now.
• Need equipment for your business? Buy and place it in service by yearend
to qualify for up to $500,000 of first-year expensing or 100% bonus
depreciation.
• Review your investments and make your year-end sell decisions, whether
to rebalance your portfolio at the lowest tax cost or to offset gains and
losses.
• If you’re charity-minded, consider giving appreciated stock that you’ve
owned for over a year. You can generally deduct the fair market value and
pay no capital gains tax on the appreciation.
• Another charitable possibility for those over 70½: Make a direct donation
of up to $100,000 from your IRA to a charity. The donation counts as part
of your required minimum distribution but isn’t included in your taxable
income.
• Install energy-saving improvements (such as insulation, doors, and
windows) in your home, and you might qualify for a tax credit of up to
$500.
These possibilities for cutting your taxes are just the
starting point. Contact us at (219) 769-3616 or e-mail your
questions to tlynch@swartz-retson.com now for a review of
your 2011 tax situation and tax-saving suggestions that
will work best in your individual circumstances.
SWARTZ, RETSON & CO., P.C.
The tax rules can provide relief when disaster strikes
Hurricanes, tornadoes, earthquakes, wildfires, floods, storms. Few parts of
the country escape the risk of natural disaster. If you’re an unlucky victim,
you may receive help from insurance and federal disaster aid. But the tax
code also offers some relief. You may be able to take an itemized deduction
for part of your loss. In tax terms, it’s a “casualty loss,” and it can also apply
to events such as a car crash, a house fire, or theft. Here are the basics.
• Sudden event. The loss or damage must be due to an unexpected and
sudden event. Losses due to slow deterioration over the years, such as rot,
rust, or insect damage, don’t qualify.
• Tax deduction. Your tax deduction won’t equal your total loss. You must
subtract any insurance or other reimbursement. Then you must also deduct
$100 for each loss and 10% of your adjusted gross income.
• Basis adjustment. Your loss may also be limited by your adjusted basis
in the property. That’s generally what you paid for it, plus or minus any
improvements or previous losses.
• Disaster classification. In a widespread disaster, the area may be
classified as a “federally declared disaster area.” If that happens, you have
two choices. You can claim your casualty loss against the current year’s
taxes. Or you can amend the previous year’s return and claim your loss
against that year’s taxes. That usually generates a faster refund, but it may
change the amount of your deduction.
If you’re unlucky enough to suffer a casualty loss, please
contact us at (219) 769-3616 or e-mail your questions to
tlynch@swartz-retson.com. We’ll help you claim the
maximum possible tax benefit.
SWARTZ, RETSON & CO., P.C
the country escape the risk of natural disaster. If you’re an unlucky victim,
you may receive help from insurance and federal disaster aid. But the tax
code also offers some relief. You may be able to take an itemized deduction
for part of your loss. In tax terms, it’s a “casualty loss,” and it can also apply
to events such as a car crash, a house fire, or theft. Here are the basics.
• Sudden event. The loss or damage must be due to an unexpected and
sudden event. Losses due to slow deterioration over the years, such as rot,
rust, or insect damage, don’t qualify.
• Tax deduction. Your tax deduction won’t equal your total loss. You must
subtract any insurance or other reimbursement. Then you must also deduct
$100 for each loss and 10% of your adjusted gross income.
• Basis adjustment. Your loss may also be limited by your adjusted basis
in the property. That’s generally what you paid for it, plus or minus any
improvements or previous losses.
• Disaster classification. In a widespread disaster, the area may be
classified as a “federally declared disaster area.” If that happens, you have
two choices. You can claim your casualty loss against the current year’s
taxes. Or you can amend the previous year’s return and claim your loss
against that year’s taxes. That usually generates a faster refund, but it may
change the amount of your deduction.
If you’re unlucky enough to suffer a casualty loss, please
contact us at (219) 769-3616 or e-mail your questions to
tlynch@swartz-retson.com. We’ll help you claim the
maximum possible tax benefit.
SWARTZ, RETSON & CO., P.C
Thursday, October 6, 2011
It's Not Just About the Money
Studies have consistently shown that employee compensation, although important, is
not the primary factor that makes workers stay at a company. It’s not all about the
money. In fact, some firms that provide stellar compensation packages suffer high
turnover, low morale, and dwindling market share. Others – including smaller
companies that may not offer tip-top benefit packages – maintain a loyal and
dedicated workforce that regularly contributes to the company’s success. In fact, many
studies show that happy workers provide more efficient production, better customer
service, and greater innovation. They’re also less likely to quit or call in sick.
What factors could make your company a better place to work? Here are four keys.
• Respect. Show employees that they matter by providing them with necessary
training, acknowledging outstanding work, and creating a healthy and upbeat
workplace.
• Fairness. Treat employees equitably. This applies, of course, to hiring and
promotion decisions, but might also include sharing the firm’s success through a
structured bonus plan.
• A sense of pride. Most people enjoy working with a team that accomplishes
something significant. Create this type of work environment and you’ll foster company
loyalty. Strive to make everything you do – and everyone you employ – an integral
part of the firm’s mission.
• Opportunities. No one looks forward to a dead-end job. Give your workers an
adventure to anticipate. Find ways to expand their horizons. For example, you might
provide cross-training to develop new skills or encourage innovation.
Even if you can’t offer the best compensation package on the planet, satisfied workers
can help propel your company forward. And they’ll let their talented friends know that
your company is a great place to work.
If you have any questions, please give us a call at (219) 769-3616
or e-mail your questions to dbatusic@swartz-retson.com.
SWARTZ, RETSON & CO., P.C.
not the primary factor that makes workers stay at a company. It’s not all about the
money. In fact, some firms that provide stellar compensation packages suffer high
turnover, low morale, and dwindling market share. Others – including smaller
companies that may not offer tip-top benefit packages – maintain a loyal and
dedicated workforce that regularly contributes to the company’s success. In fact, many
studies show that happy workers provide more efficient production, better customer
service, and greater innovation. They’re also less likely to quit or call in sick.
What factors could make your company a better place to work? Here are four keys.
• Respect. Show employees that they matter by providing them with necessary
training, acknowledging outstanding work, and creating a healthy and upbeat
workplace.
• Fairness. Treat employees equitably. This applies, of course, to hiring and
promotion decisions, but might also include sharing the firm’s success through a
structured bonus plan.
• A sense of pride. Most people enjoy working with a team that accomplishes
something significant. Create this type of work environment and you’ll foster company
loyalty. Strive to make everything you do – and everyone you employ – an integral
part of the firm’s mission.
• Opportunities. No one looks forward to a dead-end job. Give your workers an
adventure to anticipate. Find ways to expand their horizons. For example, you might
provide cross-training to develop new skills or encourage innovation.
Even if you can’t offer the best compensation package on the planet, satisfied workers
can help propel your company forward. And they’ll let their talented friends know that
your company is a great place to work.
If you have any questions, please give us a call at (219) 769-3616
or e-mail your questions to dbatusic@swartz-retson.com.
SWARTZ, RETSON & CO., P.C.
Friday, September 16, 2011
Take a refresher course on saving for college the tax-smart way
With tuition costs climbing ever higher, setting aside funds for college can be a formidable task. Here’s a refresher course on the various programs and tax breaks you can use to lessen the financial burden of college.
• Coverdell education savings accounts. These accounts offer several advantages over other college savings plans. First, there’s flexibility. Like an IRA, you can choose from a wide variety of investments to meet your individual needs. Also, funds in the account can be withdrawn tax-free if used for qualified education expenses such as tuition, room and board, books, even a computer. Unlike other programs, qualified expenses include costs of elementary and secondary school.
However, the maximum annual contribution for a beneficiary is $2,000 – from all sources. Also, funds must be used by age 30. If the funds are not spent on college by the time the beneficiary is 30 years old, the unspent money must be withdrawn (subject to income tax and a 10% penalty) or rolled over into another family member’s education savings account.
However, the maximum annual contribution for a beneficiary is $2,000 – from all sources. Also, funds must be used by age 30. If the funds are not spent on college by the time the beneficiary is 30 years old, the unspent money must be withdrawn (subject to income tax and a 10% penalty) or rolled over into another family member’s education savings account.
• Section 529 plans. If you want to put a large lump sum into a college savings account, a Section 529 plan may be your best option. In this type of account, there are no phase-out limits for high earners, and plan sponsors set maximum allowable contributions.
• Custodial accounts. With custodial accounts (Uniform Transfers to Minors Act or UTMA), you can generally invest in a wider variety of investments than with a 529 plan. The proceeds can be taken out penalty-free – even if used for something other than education. The biggest potential disadvantage is that you gift the funds irrevocably to the child. At a certain age, your child controls the account and could spend the funds on a sports car instead of college.
• American opportunity credit. With this credit you reduce your taxes dollar for dollar for education expenses incurred during four years of college. The credit has an annual limit of $2,500 per student.
• Lifetime learning credit. The limit for this credit is $2,000 per tax return, and qualified expenses include tuition, fees, and books for both undergraduate and graduate programs. You’re limited to using only one credit (American opportunity or lifetime learning) per student.
• Other options. Roth IRAs and U.S. savings bonds are additional options worth considering. You may also qualify for an interest deduction on education loans.
If you need help reviewing the options that best fit your situation,give us a call at (219) 769-3616 or e-mail your questions to tlynch@swartz-retson.com.
• Custodial accounts. With custodial accounts (Uniform Transfers to Minors Act or UTMA), you can generally invest in a wider variety of investments than with a 529 plan. The proceeds can be taken out penalty-free – even if used for something other than education. The biggest potential disadvantage is that you gift the funds irrevocably to the child. At a certain age, your child controls the account and could spend the funds on a sports car instead of college.
• American opportunity credit. With this credit you reduce your taxes dollar for dollar for education expenses incurred during four years of college. The credit has an annual limit of $2,500 per student.
• Lifetime learning credit. The limit for this credit is $2,000 per tax return, and qualified expenses include tuition, fees, and books for both undergraduate and graduate programs. You’re limited to using only one credit (American opportunity or lifetime learning) per student.
• Other options. Roth IRAs and U.S. savings bonds are additional options worth considering. You may also qualify for an interest deduction on education loans.
If you need help reviewing the options that best fit your situation,give us a call at (219) 769-3616 or e-mail your questions to tlynch@swartz-retson.com.
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