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Tax Tips Newsletter
Serving you since 1993
September 2011 - Vol 6, Issue 9
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Greetings!
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We are trying out a new voicemail system. Yes, it's one of those where a message answers instead of a real person. However, I'm hoping that this system will help you get to the person you are trying to reach sooner. (You can get to a real person by dialing "0"). On our end it has many more features so I'm hoping that the overall experience is going to be positive for everyone. Please give me your feedback.

If I am preparing your individual returns, please get me your information as soon as possible. We have quite a few returns to do so we need to get started on them.

Have a wonderful September!

Tax Deadline
You don't usually think of fall as a major tax filing time, but there are several important tax deadlines coming up this September and October. Check the deadlines below to see if any apply to you or your business.

September 15 - Due date for third quarter installment of 2011 individual estimated income tax.

September 15 - Filing deadline for 2010 tax returns for calendar-year corporations that received an automatic extension of the March 15 filing deadline.

September 15 - Filing deadline for 2010 partnership tax returns that received an extension of the April 18 filing deadline.

October 3 - Generally, the deadline for self-employed individuals and small businesses to establish a SIMPLE retirement plan for 2011.

October 17 - Filing deadline for 2010 individual income tax returns that received an extension of the April 18 filing deadline.

October 17 - Deadline for undoing a 2010 conversion of a regular IRA to a Roth IRA and switching the Roth back to a regular IRA without penalty.

If you need more information or filing assistance, contact my office.
Diploma
Are you planning to tap into your Section 529 college savings plan for education expenses this fall?

Before you do, you may want to take a quick refresher course on the tax consequences of withdrawals.

* Qualified distributions of contributions and plan earnings are tax-free, as long as you use withdrawn amounts to pay qualified higher education expenses.

* Qualified higher education expenses include your out-of-pocket expenses for tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. Also included is a limited, reasonable amount of room and board costs when you attend at least half-time (defined as half the school's standard full-time course load). Expenses for special-needs services in connection with enrollment or attendance qualify too.

* As a general rule, an eligible educational institution is a college, university, graduate, technical or vocational school.

* A 10% additional tax applies to the earnings portion of distributions that fail to meet the tax-free criteria - unless an exception applies. Exceptions include withdrawals in cases of a beneficiary's death, disability or attendance at specified military schools, and certain rollovers or transfers to other 529 plans.

Please call me for more information, including the most tax-efficient way to take distributions from your 529 plan and the interaction of withdrawals with educational tax credits and amounts taken from other tax-advantaged accounts.
Scenic floral & mountain scene
The Tax Tip of the Week. This week the tip deals with the SIMPLE retirement plan rules. The amount you choose to contribute at the beginning of the year must stay the same all year, so this is a reminder of the features of a SIMPLE plan.

The Business Tip of the Month. Does your business carry inventory? That inventory is money - what is it's value to your business? Here are some suggestions on how to value your inventory.

The Financial Tip of the Month. Who doesn't want to be wealthy? Not many of us are born rich or inherit wealth so here are some great tips on how to build our own wealth!

The Fraud Alert. Does getting an email from the IRS send shivers up your back??? Relax and DON'T open it - the IRS will NEVER initiate taxpayer communications via e-mail. Read up on another way the fraudsters are trying to get our money!

Photos © Bigstockphotos.com, istockphoto.com, Felix Orona

Sincerely,
Linda Heineman
Linda L. Heineman, CPA

phone: 626-577-0979