Summary of Dec. 6 Tax Cuts Compromise
December 7, 2010 | 
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President Obama and Republican leaders reached a compromise on December 6th regarding expiring tax cuts. Here are some highlights that might be relevant to you.
- The Bush-era tax cuts have been extended for two years. This includes an extension of the current 15% rate on capital gains (which was scheduled to increase to 20%).
- The employee share of the social security tax has been temporarily reduced (for 1 year) to 4.2% on earned income up to $106,800. Earned income up to that cap is subject to a 12.4% “social security” tax which is split between the employer and the employee; each contributing 6.2% (this 12.4% is also paid by self-employed workers). Under the deal, the employee’s portion of the tax will be cut to 4.2% for 1 year. There is no reduction in the employer’s share.
- The estate tax has a 2-year fix under which the exemption amount has been increased to $5 million (it had been $3.5 million under the old rules that expired at the end of 2009) and the top rate will be 35% (rather than the 55% scheduled to kick in on January 1st).
- Continuation of increased expensing write-off for newly acquired depreciable property. As a result of the tax legislation passed in September for property acquired in 2010 and 2011, a taxpayer can write-off in the year of purchase (rather than over a multi-year period), up to $500,000 for newly-acquired property. The expensing allowance was set to drop back to $25,000 beginning in 2012.
- Alternative minimum tax relief for approximately 22 million taxpayers. The details on this AMT relief also haven’t been published but this is probably being done by raising the AMT “exclusion amount” so that middle class taxpayers aren’t caught in this tax trap which was intended to catch high income taxpayers with a lot of itemized deductions.
This “deal” still has to get through the Senate where many Democrats and Republicans alike are unhappy with the compromise. In the meantime, this summary at least tells you where we stand at this point!
Questions?
2010 Tax Tips Series- Health Care Credits
December 2, 2010 | Subscribe to our RSS Feed
Tax Tips and Planning for 2010 continues with a third installment. After addressing credits for hiring, employee benefits and zoning/building, Tax Partner Steve Albert will explain the credits available to small businesses offering health care benefits to their employees.
The credit could be substantial, as Steve explains in the video below. For a closer look, here is the health care credit table he mentions.
Questions?
steven.albert@glassjacobson.com
Efforts to Repeal New Form 1099 Rules Begin Today
November 29, 2010 | Subscribe to our RSS Feed
Efforts to Repeal New Form 1099 Rules To Move to Senate Floor on Nov. 29- we will keep this post updated with changes to the law.
The Senate is set to vote Nov. 29 on two versions of legislation that would fully repeal a new law requiring businesses to file Form 1099 information reports to the government whenever they spend more than $600 on a single vendor.
The new Form 1099 requirements—created as a $17 billion revenue raiser for the Patient Protection and Affordable Care Act (Pub. L. No. 111-148) and expanded to include spending by landlords in the Small Business Jobs Act (Pub. L. No. 111-499)—have been broadly criticized by business groups and Republicans, who see them as an overly burdensome paperwork mandate.
Senate Finance Committee Chairman Max Baucus (D-Mont.) championed the new rules for those bills and resisted their repeal as recently as September, but growing pressure on Democrats from small businesses complaining about the rules prompted Baucus Nov. 15 to offer his own repeal bill (S. 3946) (219 DTR G-10, 11/16/10).
Baucus said he supported the new reporting requirements as a way to help cut down on tax evasion, but added: “I have heard small businesses loud and clear and I am responding to their concerns.”
Questions?
What’s Worse Than Bleeding Gums?
November 23, 2010 | Subscribe to our RSS Feed
The blog this week is a reprint of a Madow Brothers e-Letter sent earlier this fall. Some of you may have already read this but I feel strongly that what Dave and Rich wrote bears repeating. Pick up those perio probes, you will not only help your practice, you could even save a life…
As if tooth loss, horrible breath and the link to heart disease aren’t enough reasons to get your patients free from periodontal disease, now there’s more.
A recent study published in Cancer Epidemiology, Biomarkers & Prevention, a journal of the American Association for Cancer Research, shows that the presence of periodontal disease is an independent risk factor for head and neck squamous cell carcinoma. Yes – gum disease is linked to head and neck cancer.
Most surprising to the researchers was that it made no difference at all if the patient smoked or not.
“Although the study is comparatively small, the researchers were able to also see an association between bone loss and the risk of head and neck cancer, ” according to Andrew Olshan, professor and chair of the Department of Epidemiology at the Gillings School of Global Public Health, and professor in the Department of Otolaryngology/Head and Neck Surgery, School of Medicine, University of North Carolina at Chapel Hill.
Hygienists – sharpen your scalers. And for the rest of us, if we ever needed more reasons to wage a full out war on perio disease, this is it. Having a solid soft tissue management program in your practice does a lot more than raising revenue – it saves lives!
We urge you to be incredibly diligent about your patient’s periodontal health. It’s not just about having a hygiene department that is robust financially (although that sure doesn’t hurt) – it’s about saving teeth, preventing heart disease, and lowering cancer rates. Wow!!
Questions for Larry the Accountodontist?
larry.goldberg@glassjacobson.com
2010 Tax Tips Series- More Credits for Businesses
November 19, 2010 | Subscribe to our RSS Feed
Tax Tips and Planning for 2010 continues. We have looked closely at credits available to businesses hiring. Now we’ll focus on a few other opportunities for businesses to improve cash flow, including:
- Enterprise zone and other credits available to businesses based on their location (you can find the Enterprise Zone map here)
- Employee benefits credits
- Cost Segregation studies
- Credits for going green
Steve Albert, Tax Partner, speaks in more detail in the video below. If you think any of these areas may be relevant to your business, talk to Steve today.
steven.albert@glassjacobson.com