 | Pay State Estimates Before Year-end!
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For those who pay estimated taxes, we know both the federal and state 4th quarter estimates are due mid-January 2011. If you itemize on your return, state taxes, including estimated payments, are deductible in the year paid. Thus the recommendation -- pay your 4th quarter estimate on or before December 31, 2010 and it will be deductible in 2010, not 2011.
If you have had a strange year, ask your tax accountant to run a quick check on your 2010 state tax liability to "fine tune" the amount to pay for your 4th quarter.
There is only a short window of time with Christmas looming large. Do it now.
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| Health Insurance Deductible for 2010 SE Tax!
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In one of Congress's recent stimulus efforts, there was included a provision to have health insurance costs be deductible in calculating 2010 "self-employment" income and thus the 2010 SE tax.
This can be big! If you have self-employment income and a 2010 health insurance cost of $10,000, this little provision will save you $1,530 on your final tax 2010 bill. That's right, it will save 15.3% of the health insurance cost, up to the maximum SE income level of $106,800.
This currently is available only for 2010. We'll have to wait to see if the new Congress extends.
Be sure whomever does your 2010 tax return is aware of this. It would be tragic to lose this nugget out of ignorance.
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My website has much more information about my practice and credentials as a seasoned business attorney and counselor. Just click on the link below and you'll be there.
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REMEMBER --
Other Legal Alerts and Legal Reliefs and all prior Newletters are available at my website.
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This general information is not intended to be nor should it be treated as tax, legal or accounting advise.
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