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Residential Energy Tax Credit

Taxpayers can claim a credit for certain qualifying home improvements placed in service in 2010. The property must be installed in the taxpayer’s principal residence that is located in the U.S. New construction, vacation and rental homes don’t qualify.

Qualifying improvements must be placed in service before Jan. 1, 2011.

Personal Energy Property Credit Qualifying Improvements:

Materials & cost of labor: high-efficiency heating and air conditioning systems, hot water heaters and stoves that burn biomass.

Materials only: energy-efficient windows and sky-lights, energy-efficient doors, qualifying insulation and certain roofs.

Credit equals 30% of what a homeowner spends on eligible energy saving improvements, up to a maximum tax credit of $1,500 for the combined 2009 and 2010 tax years.

Residential Energy Efficient Property Credit Qualifying Improvements:

Materials & cost of labor: solar energy systems (water heating and electricity), fuel cells, small wind energy systems, and geothermal heat pumps.

Credit equals 30% of what a homeowner spends, with no maximum. New construction does qualify.

Manufacturers must certify that their products meet the standards and must provide a written statement to the taxpayer included with the packaging of the product or in a printable format on the manufacturers’ website.

Additional information is available on the IRS website at www.irs.gov.

If you have any questions please call us at 610-485-1010.

 

Stay tuned for more…

This is a guest blog by Jacqueline M. Ward, who is the Tax Operations Manager (TOM) at "Your Best Interest" Financial Services Inc. She combines her education in accounting, years of experience and attention to detail to provide her clients with confidence and peace of mind that their tax returns are completed accurately and in a timely manner.  Jackie is the mother of 7 children, 2 girls and 5 boys. Two of her sons are presently serving our country in the military; one in the U.S. Marine Corps and the other a midshipman at the United States Naval Academy.

To contact Jackie call 610 485-1010 or email her at jward@ybifs.com

Medical Expenses

You can deduct on Schedule A, Form 1040, the amount of your medical and dental expense that is more than 7.5% of your AGI (Form 1040, line 38).

Medical expenses are deductible in the year paid, regardless of when the expense is incurred. Deductible medical expenses include expenses paid for the taxpayer, taxpayer’s spouse, and taxpayer’s dependent (for claiming an exemption). Deductible medical expenses include:

Prescription medications Health insurance premiums

Long-term care premiums Fees for doctors, dentists, etc

Fees for hospitals, clinics, etc Lab and x-ray fees

Expenses for qualified long-term care Eyeglasses and contact lenses

Medical equipment and supplies Medical transportation expenses

Lodging for medical purposes Day camp for children with disabilities

For more information about medical expenses, see IRS Publication 502: Medical and Dental Expenses, available at IRS.gov or by calling 800-829-3676.

If you have any questions please call us at 610-485-1010.

 

Stay tuned for more…

This is a guest blog by Jacqueline M. Ward, who is the Tax Operations Manager (TOM) at "Your Best Interest" Financial Services Inc. She combines her education in accounting, years of experience and attention to detail to provide her clients with confidence and peace of mind that their tax returns are completed accurately and in a timely manner.  Jackie is the mother of 7 children, 2 girls and 5 boys. Two of her sons are presently serving our country in the military; one in the U.S. Marine Corps and the other a midshipman at the United States Naval Academy.

To contact Jackie call 610 485-1010 or email her at jward@ybifs.com

IRS Kicks Off 2011 Tax Season

 

Below is a bulletin released by the IRS regarding the upcoming tax filing season. We encourage you to bring in all your tax documents as early as possible. We will prepare your tax returns and place them on hold until the IRS is ready to process the returns.

 

IRS Newswire                                                                              January 4, 2011

IRS Kicks Off 2011 Tax Season with Deadline Extended to April 18; Taxpayers Impacted by Recent Tax Breaks Can File Starting in Mid- to Late February

WASHINGTON — The Internal Revenue Service today opened the 2011 tax filing season by announcing that taxpayers have until April 18 to file their tax returns. The IRS reminded taxpayers impacted by recent tax law changes that using e-file is the best way to ensure accurate tax returns and get faster refunds.

Taxpayers will have until Monday, April 18 to file their 2010 tax returns and pay any tax due because Emancipation Day, a holiday observed in the District of Columbia, falls this year on Friday, April 15. By law, District of Columbia holidays impact tax deadlines in the same way that federal holidays do; therefore, all taxpayers will have three extra days to file this year. Taxpayers requesting an extension will have until Oct. 17 to file their 2010 tax returns.

The IRS expects to receive more than 140 million individual tax returns this year, with most of those being filed by the April 18 deadline.

Who Must Wait to File

For most taxpayers, the 2011 tax filing season starts on schedule. However, tax law changes enacted by Congress and signed by President Obama in December mean some people need to wait until mid- to late February to file their tax returns in order to give the IRS time to reprogram its processing systems.

Some taxpayers – including those who itemize deductions on Form 1040 Schedule A – will need to wait to file. This includes taxpayers impacted by any of three tax provisions that expired at the end of 2009 and were renewed by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act Of 2010 enacted Dec. 17. Those who need to wait to file include:

• Taxpayers Claiming Itemized Deductions on Schedule A. Itemized deductions include mortgage interest, charitable deductions, medical and dental expenses as well as state and local taxes (add link to Schedule A). In addition, itemized deductions include the state and local general sales tax deduction that was also extended and which primarily benefits people living in areas without state and local income taxes. Because of late Congressional action to enact tax law changes, anyone who itemizes and files a Schedule A will need to wait to file until mid- to late February.
• Taxpayers Claiming the Higher Education Tuition and Fees Deduction. This deduction for parents and students – covering up to $4,000 of tuition and fees paid to a post-secondary institution – is claimed on Form 8917. However, the IRS emphasized that there will be no delays for millions of parents and students who claim other education credits, including the American Opportunity Tax Credit extended last month and the Lifetime Learning Credit.
• Taxpayers Claiming the Educator Expense Deduction. This deduction is for kindergarten through grade 12 educators with out-of-pocket classroom expenses of up to $250. The educator expense deduction is claimed on Form 1040, Line 23 and Form 1040A, Line 16.

The IRS will announce a specific date in the near future when it can start processing tax returns impacted by the recent tax law changes. In the interim, taxpayers affected by these tax law changes can start working on their tax returns, but they should not submit their returns until IRS systems are ready to process the new tax law changes. Additional information will be available at www.IRS.gov.

For taxpayers who must wait before filing, the delay affects both paper filers and electronic filers. The IRS urges taxpayers to use e-file instead of paper tax forms to minimize confusion over the recent tax law changes and ensure accurate tax returns. 

If you have any questions please call us at 610-485-1010.

 

Stay tuned for more…

This is a guest blog by Jacqueline M. Ward, who is the Tax Operations Manager (TOM) at "Your Best Interest" Financial Services Inc. She combines her education in accounting, years of experience and attention to detail to provide her clients with confidence and peace of mind that their tax returns are completed accurately and in a timely manner.  Jackie is the mother of 7 children, 2 girls and 5 boys. Two of her sons are presently serving our country in the military; one in the U.S. Marine Corps and the other a midshipman at the United States Naval Academy.

To contact Jackie call 610 485-1010 or email her at jward@ybifs.com

Same as Last Year

Every year we get asked the same questions about Charitable Contributions:

• What is the “standard deduction” I can take for charitable contributions?
• How much did I claim last year?
• Do I need receipts?

The answers are simple. There is no “standard deduction”. It doesn’t matter how much you contributed last year. Yes, to be deductible you need receipts. In recent years the IRS began aggressively enforcing its requirements for documentation of charitable contributions. Our job is to help you remain compliant to the IRS and prepare accurate tax returns for you. Following are some of the guidelines set forth by the IRS, to aid you in preparing for tax season.

To be deductible, charitable contributions must be made to qualified organizations.

Cash contributions include those paid by cash, check, electronic funds transfer, debit card, credit card, or payroll deduction. You cannot deduct a cash contribution, regardless of the amount, unless you keep one of the following.

1. A bank record that shows the name of the qualified organization, the date of the contribution, and the amount of the contribution. Bank records may include:

• A canceled check,
• A bank or credit union statement, or
• A credit card statement.

2. A receipt (or a letter or other written communication) from the qualified organization showing the name of the organization, the date of the contribution, and the amount of the contribution.

You must get the acknowledgement on or before the earlier of:

• The date you file your return for the year you make the contribution, or
• The due date, including extensions, for filing the return.

If you make any noncash contribution, you must get and keep a receipt from the charitable organization showing:

• The name of the charitable organization,
• The date and location of the charitable contribution, and
• A reasonably detailed description of the property.

In addition, you must provide a written value of the property at the time of donation.

For more information about Charitable Contributions, see IRS Publication 526: Charitable Contributions, available at IRS.gov or by calling 800-829-3676.

If you have any questions please call us at 610-485-1010.

 

Stay tuned for more…

This is a guest blog by Jacqueline M. Ward, who is the Tax Operations Manager (TOM) at "Your Best Interest" Financial Services Inc. She combines her education in accounting, years of experience and attention to detail to provide her clients with confidence and peace of mind that their tax returns are completed accurately and in a timely manner.  Jackie is the mother of 7 children, 2 girls and 5 boys. Two of her sons are presently serving our country in the military; one in the U.S. Marine Corps and the other a midshipman at the United States Naval Academy. 

To contact Jackie call 610 485-1010 or email her at jward@ybifs.com