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It All Add$ Up March News
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Greetings!
In this March Newsletter you will find a list of identity theft scams from 2012 and tax tips for saving on health care.
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IRS Lists 2012 Dirty Dozen Identity
Theft Scams
The Internal Revenue Service has issued several recent consumer warnings on the fraudulent use of the IRS name or logo by scamsters trying to gain access to consumers' financial information in order to steal their identity and assets. To read the entire article, click here.
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Tax Tip: Health Savings Accounts Offer Way to Save on Taxes and Health Care
For Americans facing increased taxes and rising health care costs, the tax advantages and cost-effectiveness of a health savings account (HSA)  may be particularly appealing this year. Different plans require specific documentation, so be sure you understand how to file your medical claims to achieve the full benefit of pre-tax savings.
Employees should plan ahead for medical purchases that may qualify such as new eyeglasses, dental work and hearing aids, as well as everyday prescription purchases. Remember HAS's must be used and are not eligible for carry over to the following year.
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Consumption Tax vs. Income Tax
Many states are debating the current income tax structure in lieu of a flat consumption tax which would amount to a beefed-up sales tax on every item purchased. It is believed that by broadening the sales tax on all items purchased, the tax structure would become more evenly disbursed and additional revenues would be gained.
Those that purchase more would pay higher taxes. As part of proposals currently being debated, income, estate and gift, and FICA taxes would all be eliminated after 2014. There would be no corporate income tax and capital gains would be tax free.
In their place, a federal sales tax would be levied on all goods and services a tax rate of 29.9% across the board would be charged. This proposal has many hurdles yet to pass, but we'll keep you posted on any changes that may be forthcoming.
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Tax Deduction for Mortgage Interest
 In the event floating rate mortgage interest due has exceeded monthly mortgage payments, homeowners cannot deduct accrued but unpaid mortgage interest. All excess interest would be added to the mortgage balance and homeowners are only permitted to write-off the interest that was actually paid during the year. |
