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K&A Staff Volunteer with Junior Achievement
In the midst of our hectic audit and tax season, K&A professionals donated their time to several local area schools, volunteering with the Junior Achievement program (http://www.jachicago.org/).
Our staff taught classes ranging from kindergarten through fifth grade on global commerce, financial concepts and how business affects their lives and futures.
Pictured above from our morning at Lace School District from left to right: Paul Malina, Sue Rudis, Principal Martin Casey, Ryan Ogasawara, Kim Duzsa, Bridget Kenney, and Dave Storey. |
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Late Tax Filing Penalties
Sometimes smart people forget to do smart things - and when taxes are involved, a lapse of memory may be costly. For example, two penalties can apply if you forget the federal income tax filing deadline.
- The failure-to-file penalty is assessed each month or part of a month from the due date until you submit your return. The penalty is calculated on the net amount of tax you owe - so no tax due means no penalty.
- The failure-to-pay penalty comes into play when you owe tax but fail to pay it by the due date of your return. This is true even if you received an extension of time to file the return.
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2012 Taxes Quick Guide
Taxes 2012 QuikGuide will help you keep track of tax filing deadlines, recordkeeping requirements, and those tax numbers you need for your 2012 tax planning.
We hope you find this handy guide useful. If you have questions, or if we can assist you with any of your tax concerns, please contact us.
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Credits For Hiring Veterans; Basis Reporting Expands; More Small Business Audits
A law signed in November 2011 created new tax credits for employers who hire unemployed veterans.
Employers may qualify for the "Returning Heroes Tax Credit" of up to $5,600 for hiring a veteran who has been unemployed for more than six months. A credit of up to $2,400 is available for hiring a vet who has been unemployed for more than four weeks but less than six months.
The "Wounded Warriors Tax Credit" is available to employers who hire a vet with service-connected disabilities. The credit maximum is $9,600; the vet must have been unemployed for more than six months.
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Is Home Equity An Investment?
When determining the mix of stocks and bonds in your financial portfolio, should you include the equity in your home? It's an important question. If you add the value of your home (minus the outstanding mortgage) to your portfolio, you may find that the mix of stocks and bonds needs to be adjusted.
A general rule that some follow states that the stock portion of your portfolio (including stock mutual funds) should equal 100 minus your age. Using this rule, a fifty-year-old man should invest 50% of his portfolio in stocks and the rest in bonds or other generally conservative investments. Real estate fits into this "other" category. Say you have a financial portfolio that's worth $500,000, evenly allocated between stock and bond mutual funds. Let's further hypothesize that you have $100,000 in home equity. Adding that equity to your financial portfolio will change the mix of stocks and other investments from 50/50 ($250,000 in stocks; $250,000 in bonds) to 42/58 ($250,000 in stocks; $350,000 in bonds/other). Because your portfolio is now less heavily weighted toward stocks, you may decide to increase the stock portion. That will mean, other things being equal, accepting greater volatility and risk.
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New Foreign Investment Requirement
New form alert! If you own foreign investments, you may have an additional federal tax filing requirement this year.
Form 8938, "Statement of Specified Foreign Financial Assets," is due April 17, 2012, and is filed as part of your individual tax return. You'll use Form 8938 to disclose interests in certain foreign financial accounts when your ownership exceeds the reporting requirements.
What are the reporting requirements? They vary depending on where you live and your filing status. For example, say you're married and live in the United States, and you'll file a joint tax return for 2011. You'll include Form 8938 with your tax return when the total value of your reportable assets on the last day of 2011 is more than $100,000, or if the value exceeds $150,000 at any time during the year ($50,000 and $75,000 for singles).
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What's New in 2012?
Click here for a quick review of some of the tax changes you'll see from 2011 to 2012 as a result of inflation adjustments and tax law
changes.
For details or a discussion of these and other changes that could affect your situation, give us a call. |
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