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    What You Need to Know for Your 2011 Tax Filing and What’s New for 2012

    Fantasy Finance

    Tax season is here again! While the filing deadline might be a couple of months away, this month you will receive all required third-party reporting documents: W2s, 1099s for interest and dividends, 1099s for nonemployee compensation if you are an independent contractor, 1099-Bs from your broker reporting proceeds from the sale of stocks and bonds, 1098s from your mortgage holder, K-1s from partnerships, S Corps, estates, and trusts. Hopefully, you’ve set up a file to store all these documents to make data gathering for tax preparation a snap. If not, now’s the time to create one.

    Note that the due date for filing this year is April 17. If a tax due date falls on a weekend or a holiday, the next business day becomes the due date. This year April 15 is a Sunday and Monday, April 16 is a federal holiday so the due date falls on Tuesday, April 17. If you are unable to file by the deadline, you may obtain an extension to Oct. 15. Bear in mind that the extension is for filing, not paying. All taxes must be paid by April 17 otherwise you may suffer penalties and interest.

    If you pay estimated tax payments throughout the year, the due date for your next quarterly installment for prepayment of 2011 income taxes is Tuesday, Jan. 17. Estimated tax payments for 2012 will be due on April 17, June 15, Sept. 17 and Jan. 15, 2013.

    Beginning in 2011, brokerage firms are required to report to the IRS not only proceeds from sales of stocks and mutual funds, but also the cost basis of the investments that are sold. The IRS has designed a new Form 8949 for reporting capital gains and losses. A summary of the information listed on this form is carried over Schedule D. A couple of new columns are added to Form 8949 reporting – one for adjustments to basis (in case your broker has an incorrect figure) and one for coding the transaction to identify the type of sale.

    Business mileage rates for 2011 were changed mid-year, so when calculating your mileage for 2011 use the rate of 51 cents per mile for miles driven up to June 30, 2011 and 55 ½ cents per mile from July 1 to Dec. 31.

    Mileage rates for 2012 are as follows: 55 ½ cents per mile for business, 23 cents per mile for moving and medical, and 14 cents per mile for charitable purposes.

    The temporary payroll tax cut has been extended to Feb. 29; employees will enjoy a continued savings of 2% of wages withheld for Social Security – from 6.2% to 4.2%. The Social Security wage base for 2012 is $110,100 up from $106,800 in 2011. Once your wages exceed this amount, Social Security will not be withheld but Medicare will continue to be withheld.

    The self-employment health insurance deduction no longer offsets the self-employment tax. In 2010 only, self-employed workers were able to reduce the amount subject to self-employment tax on Schedule SE by the amounts paid for health insurance premiums. You can still take the deduction on Form 1040 as an adjustment to income.

    Foreign financial assets are reported on a new Form 8938. The foreign asset disclosure form is separate and different from the foreign bank account report. Taxpayers with foreign assets may need to file both documents.

    The first-time home buyer’s credit is now only available to members of the military or Foreign Service. If you are repaying the first-time home buyer’s credit, you may not need to complete and attach Form 5405.

    Also gone for 2011 is the Making Work Pay Credit. For the past few years we enjoyed $400 per year single and $800 married filing joint credit against our tax liabilities.

     
    • M G  •  3 months ago
      well..this is helpful. not. bookmarked the page & now the article is gone. guess i don't need to know anything about my tax return, eh yahoo?
    • Kate  •  Las Vegas, Nevada  •  3 months ago
      Why not eliminate any tax on income and just pay on purchases exempting food. This would make things a whole lot more fair across the board without discouraging people from working extra.
    • Zepp1  •  Bethesda, Maryland  •  3 months ago
      The author here is wrong in her second pararaph. April 16 is NOT a federal holiday since if it were, it would be listed on OPM's website. It is known as Emancipation Day and is only a holiday for District of Columbia government workers, not the entire Federal government.
    • bb4  •  Pikeville, Tennessee  •  4 months ago
      Why not stop income taxes for people over 65---we struggle to pay what we have to, as many others do---retired for many years and still paying .Too bad we're not young and jobless--- we could probably get by without paying every year .How about switching for awhile the ones that don't and the ones that do---let them get a taste of it.
    • Allen  •  Riverside, California  •  3 months ago
      Taxes are not legal.
    • Mike S  •  Chicago, Illinois  •  4 months ago
      THE DECLARATION OF INDEPENDENCE
      "That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government..."
      • A Yahoo! User 4 months ago
        thumbs up x100000000
      • Bill 4 months ago
        The problem is, this administration does not care about The DECLARATION OF INDEPENDENCE, or our BILL OF RIGHTS or our CONSTITUTION, all that's just toilet paper to them.
      • Harry 4 months ago
        Just a thought.......when they wrote " institute new government" does that in fact mean......voting idiots out and new in or do you think it means something far deeper? Needless to say I think our system is broken but just voting for different politicians isn't the answer. Our fore fathers were not career politicians...they were business men first.... then somewhere along the line when politics became a full time job for these self serving idiots our country started spiraling down the toliet.
    • commonsense  •  Los Angeles, California  •  4 months ago
      Taxed on what we make, taxed on what we spend, and don't forget--- taxed on what we sell...
      • PSUSteeler 4 months ago
        You're just figuring this out now? If so, welcome to America.
      • Richard 4 months ago
        You cant have it both ways; either you pass sales tax on and YOU don't pay it, or you don't pass it on and then you do. It is rare for a business to pick up sales tax. Only private sales are otherwise taxed, unless you are clever and have depreciated it. Or make enough to write it off. If you actually have money, an accountant can help you escape a bundle of taxes. Only those lacking capital consolidation actually get ripped off.
      • mexicant 4 months ago
        It's called an Obama-nation of our lives!
    • Red  •  4 months ago
      Taxation without representation was one of the reasons we broke from England. When was the last time you thought you were represented in government?
      • Greta 4 months ago
        you must be a demicrate the republicans are over represented right now.
      • ar 4 months ago
        11-22-1963
      • HarveyTheHeathen 4 months ago
        Who do you think HAS the representation? Corporations, banks and the very rich, not the middleclass and certainly not the poor.
    • Cowboy  •  Jacksonville, Arkansas  •  4 months ago
      gonna miss that making work pay credit QQ
      • Daphne 4 months ago
        The Republicans are against the Making Work Pay tax credit, so they got rid of it. But millionaires keep all their tax breaks.
      • Jon 4 months ago
        Your out of your tiny little mind . Its the Democrats that created the income tax to begin with.To fund ww1.Its also the Democrats that began taxing social security,(Billy boy Clinton I believe).And who keeps screaming for tax increases? Democrats. Get your story straight Daphne.Oh and wait till you get your tax bill for Obama care.
      • Jesse 4 months ago
        for the rich idiot, tax increases for the NON PAYING RICH
    • John  •  Sioux Falls, South Dakota  •  4 months ago
      If Social Security is going to abolished before I retire then I demand that every cent that I paid into Social Security be reimbursed and put into my 401k.
      • Homer 4 months ago
        don't forget your employer match
      • Casey 4 months ago
        yup, that has always concerned me.
      • Snake 4 months ago
        I wish they would do that then I know I would have money to live on in retirement
    • DeAnn  •  Terril, Iowa  •  4 months ago
      You should never get back more in taxes than you paid in! How is it that if you don't work or barely work and pay little to no taxes, you get a check for thousands of dollars as a tax refund, shouldn't a tax refund be a refund of taxes you paid in!
    • Mark  •  Rockford, Illinois  •  4 months ago
      I work, i get paid, they take taxes out... fine
      but then i take that same check (that was already taxed) to the store to buy food and at the end of my order i am..... taxed again? i would really like to know how that one worked out.
    • Jessica M  •  Phoenix, Arizona  •  4 months ago
      I thought changing the rules in the middle of a game was called cheating.
    • FedUp_with_Politics  •  4 months ago
      Way to screw the WORKING, and I stress WORKING people getting screwed... If you work anymore you are penelized BUT, if you sit on your #$%$ and let the Gov. take care of you you will get a nice fat check!. My brother and his druggie wife do not work at all yet collect foodstamps, welfare, etc., yet at the end of the year they make thousands on earned income credit, child tax credit, etc. How can you make money if you did not work? Our Gov. sucks people.
    • Carrie L  •  4 months ago
      As an ex-employee of the IRS, it is amazing how few taxpayers ever go the irs.gov official IRS tax website. It has all kinds of needed information before and after you file. After leaving I wrote "Don't Mess With The IRS" to help taxpayers that are already having tax problems and end up in collections. It is a "how to" resolve tax issues yourself and were to go on the official site. So many taxpayers I worked with dealt with incompetent tax preparers and paid people to represent them in collections, but those people never even called on their behalf. In the book I warn people to beware of anyone they have preparing or resolving their taxes. So many people misrepresent themselves.
    • Mike n Kyle  •  Collinsville, Illinois  •  4 months ago
      I agree. Paying taxes doesn't bother me either. It's people who have been on welfare off and on for years and who have no accountability of paying the state back., They always get several thousand of dollars back each year. To me, they shouldn't be allowed a refund as long as they are benefitting from the State. GRRRRRRR
    • LiLi Gough  •  Paragould, Arkansas  •  4 months ago
      I don't mind paying taxes either, but I do think that ALL the states need to incoorperate the drug testing for Govenment assistance. I am sick of paying taxes for people who just sit on their buts and have children. My husband and I just had a baby and we can't even get help for school because we make to much. What kind of crap is that where people try to better themselves can't while people who don't want to make theirselves any better get 500 in foodstamps a month, housing paid for and WIC. Also people that do not work still seem to figure out a way to file taxes and get the child tax credit which I think is Bullmess!!
    • DavisMc  •  Roswell, Georgia  •  4 months ago
      Our founding fathers would be shocked at how pointlessly complicated our tax codes are; flat tax/fair tax - something needs to change.
    • Fucccckk-off  •  Phoenix, Arizona  •  4 months ago
      Tea Party Communists Pay the Tax you owe..Make Big Business pay They pay Nada Now
    • Rosey  •  Tampa, Florida  •  4 months ago
      Earned income credit was intended for working families...who are not collecting welfare subsidies...what happened? I know a few single mothers who only worked parttime...only had a few hundred dollars in taxes paid...but got a refund check for thousands of dollars. It's just plain rediculous...they should only get back what they paid into it. And the cap for social security is rediculous as well...if you make over $110,000...you don't have to pay into social security? Does that mean they cannot collect it either? Only fair

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