NOVEMBER, 2010
This issue contains the following articles:
Click on the name of the article you want to read below: |
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Be sure to listen to Alvin Pearlman, Burkhardt & Co.'s Tax Partner on WKRC's 550 AM Simply Money with Nathan Bacharach and Ed Finke on the first Thursday of the month at 6:00 pm.
Visit our website:
or Call us at: (513) 248-9210
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We are Quickbooks certified. Please contact us for additional information. |
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Coming Soon: Two Changes in Health Care Rules |
* If you use funds you've set aside in a tax-advantaged health account to buy over-the-counter medications, you need to be aware of a change scheduled for next year.
Starting in 2011, over-the-counter medications, such as aspirin, flu medications, and allergy pills, cannot be purchased with funds from health savings accounts (HSAs), Archer medical savings accounts (MSAs), health flexible spending arrangements (FSAs), and health reimbursement arrangements (HRAs). Exceptions to this new rule: insulin, certain medical devices and supplies, and over-the-counter drugs for which you have a doctor's prescription.
With this coming change in mind, you might want to stock up on over-the-counter medications before December 31, 2010.
* The 2010 health care reform law included a requirement that employers report the value of health coverage they provide to employees, beginning with W-2 forms for 2011.
The IRS has announced that it will make this reporting optional for 2011 W-2 forms in order to give employers additional time to adjust payroll systems and procedures. The IRS also reminded taxpayers that the amount reported is not taxable income to the employee; the reporting is for informational purposes only. |
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There's Still Time to Make 2010 Tax-Free Gifts
The tax code allows you to give away up to $13,000 each year to as many people as you want, without triggering gift tax. If you and your spouse "split" your gifts, you can double this $13,000 annual gift-tax exclusion and give $26,000 per recipient.
If you're thinking of sharing your wealth, here are some important gift-giving considerations.
* All gifts during the year, including birthday and holiday presents, count toward the $13,000 (or $26,000) annual gift tax exclusion. For example, say you give a $500 birthday present to your grandchild. You may give another $12,500 to that grandchild during the year without triggering the need for a gift tax return.
* A gift made by check isn't complete until the recipient actually deposits or cashes the check. Plan accordingly when making year-end gifts, especially if you want such gifts to be counted toward this year's gift tax exclusion.
* For a gift to be valid, you must part with ownership. Pay special attention to gifts of stock in the family business or gifts of your personal residence.
* Three types of gifts are exempt from the $13,000 limit. You can make unlimited gifts for tuition expenses or medical expenses on behalf of any person, provided you make the payments directly to the educational institution or health care provider. You can also make unlimited gifts to your spouse.
If you would like to discuss the benefits of making tax-free gifts, please contact our office. |
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Please contact us if you would like additional information or would like to discuss any of the enclosed information in further detail.
Sincerely,
Burkhardt & Co. |
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