Newsletter | January 2011

Happy New Year!

We at Roth CPA & Associates hope 2012 is a happy and profitable year for you!

Tax Organizers

If we did your tax return last year, we will be mailing an organizer packet to you within the next few days. Once you receive your packet, please call us to schedule a time to bring us your tax information.

Most people will need to schedule their appointment for February since they’ll be receiving tax related statements in the mail through January. It’s not too early to schedule your appointment now though. Schedule now so that you get a time that’s convenient for you. We’re looking forward to seeing you!

If we didn’t do your taxes last year and you would like us to send you an organizer packet, please give us a call or send us an email requesting an organizer packet and we’ll be glad to send a free organizer.

Following are the some of the major tax changes for 2011:

Federal Estate (Death) Tax:
For those who were rich and died in 2010, their heirs got a huge bonus - zero Federal estate taxes. Not so for 2011, the "death tax" has been overhauled to give a one time per person $5 million exemption and a top rate of 35%. For married couples the exemption is $10 million.

Long Term Capital Gains Rate 15%:Capital gains were supposed to revert to 20% but the extension of the Bush Tax Cuts keeps them at a maximum of 15%. The holding period is the same 1 year. Any gain less than that would get taxed at your marginal rate for ordinary income.

2011 Child Tax Credit:
I n 2011, the child tax credit was supposed to return to $500 from the $1,000. Instead the credit is still $1,000.

In most cases, the 2011 credit is limited to the amount of tax liability on your income return. In other words, if your credit is bigger than your liability, your liability is just reduced to zero, and the rest is lost.

In some instances you can get a child tax credit refund. This means that you would get a refund of the difference between your tax credit and what you owe in taxes.

Alternative Minimum Tax (AMT):
It is anticipated that in 2011, an automatic annual inflation adjustment will be applied to this exemption. Currently hitting the middle class more than the intended higher class, this change will account for inflation.

2% Reduction in Payroll Taxes:
Social security taxes for 2011 were lowered by 2 percentage points for both the employee and the self employed. This gives employees up to $2,100 of additional breaks. Currently this benefit is set to expire in early 2012 but there is fairly widespread support for continuing this reduction in some form.

We are looking forward to seeing you during this year’s tax season! Please call us at (513) 530-9000 to schedule your appointment.