Reporting of foreign bank account for US citizens

Each United States person is required to disclose any financial interest in foreign bank accounts on Form TD F 90-22.1, commonly referred to as FBAR, if the aggregate value of all accounts exceeds $10,000 at any time during the calendar year. Disclosure is mandatory with possible criminal and civil penalties for failure to report or filing a false report

Tips for 2011 tax year

Deduction, by a cash basis tax payer, of expense paid by check that was mailed on December 31

A payment by check is deductible when it is delivered to the payee or when it is placed in the mail, but only if the check is paid by the bank to the payee. [Rev. Rul. 80-335]. If at the time the check is presented to the bank, there are no funds in the account to cover the check but the taxpayer has overdraft protection and the bank honors the check

Section 179 deduction for 2011 tax year

The deduction limit for tax year 2011, after the most recent Stimulus Act, is $500,000 while the total amount of equipment purchased not to exceed 2 million.

Listed below are examples of equipment that qualifies for section 179 deduction, for the 2011 tax year, as long as it was purchased or leased and placed into service between January 1, 2011 and December 31, 2011.

Employee Benefit Program: Circuit court overrules IRS’s attempt to deny taxpayers deduction

Employee Benefit Program: Circuit court overrules IRS’s attempt to deny taxpayers deduction

Here is court case. A husband and his wife operate a farm. The husband is the owner and the decision maker on the farm. Before 2001, the wife worked for her husband on the farm for 20 years without compensation. In 2001, the wife becomes an employee of the farm supervised by the husband. The wife worked about 40 hours a week. She set up an employee medical reimbursement plan. The couple used the plan to deduct 100 percent of their federal, state and FICA taxes for family medical costs and saved on average of $4000 a year. The wife opened an individual checking account and used it to pay family insurance premiums and medical bills not covered by insurance for the couple and their two children. Besides

Basic Records for Your Tax Accountant to Prepare Your Return

Part I – Assembling Records Related to Income
Payroll – Provide your W-2. Do you realize that employers make mistakes? It is not easy to save all of your pay stubs; however it can be to your advantage to reconcile your W-2 with paychecks stubs and make sure there are no mistakes on the W-2. Therefore, it is recommended to save all paycheck stubs and at the end of the year summarize them and compare it to your W-2 records.