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IRS Announces When Returns Can Be Filed
The IRS just released a notice announcing that processing of returns will commence on January 30, 2013 for most individuals. More complex returns will not be accepted by the IRS until late February or even into March, 2013 due to the complex changes to the IRS software system caused by last week’s new tax law. The notice mentioned […]
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Reprieve For S Corporations With Built-in Gain
Many farmers had C corporations with very low basis land in them. As discussed in several posts, corporations with land face a double tax that in many cases can exceed 65% of the value of the land sold by the time the money from the sale is distributed to its shareholders. One of the options […]
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Fiscal Cliff Tax Bill May Increase Divorce Rate!
Congress created laws several years ago to mitigate the effect of married couples paying a higher tax than two single people living together. The extra tax was commonly known as the “marriage penalty”. The Fiscal Cliff Tax Bill passed last week has brought this marriage penalty back into existence and it appears to be even greater than […]
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Up to Ten Capital Gains Tax Rates for 2013!
After reviewing the various phase-outs of itemized deductions and personal exemptions based upon gross income plus the implementation of the new 3.8% investment surtax, for 2013 there now at least 10 different possbile maximum long-term capital gains and qualifying dividends tax rates. The rates range from zero for that portion in the 10-15% tax bracket […]
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Section 179 / 50% Bonus Depreciation
Due to the passage of the new tax law this week, we have gotten several questions about Section 179 and bonus depreciation. A couple of questions are as follows: “Can you please expand on the extension of section 179? For 2012, will the limits remain at $139,000/$560,000 or do they increase to $500,000/$2mil. For 2013, […]
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Some More Goodies Buried in the Fine Print
Included in the tax bill passed this week were some additional tax “goodies” for both farmers and non-farm taxpayers. In previous years, taxpayers over age 70 1/2 were allowed to contribute up to $100,000 each year to a qualified charity and not have it count as income. The amount given to the charity was not […]
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Help! What Is My Capital Gains Tax Rate?!
We are continuing to digest the new tax bill (assuming President Obama signs it today). One of the unique features in this tax bill is, that for many taxpayers, they will not accurately know their capital gains (or qualified dividends) tax rate until they prepare their tax return. In brief, we know the following for […]
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Some Major Tax “Goodies” in Senate Bill For Farmers!
The Senate in the early morning hours of January 1, 2013 passed a bill to avert the “Fiscal Cliff”. This bill is now headed to the House and it may be passed, not passed or amended and passed back to the Senate for further agreement. Assuming that the Bill is passed as is, there are […]
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Be Careful Of Fiscal Year Section 179 Issues!
Section 179 and bonus depreciation provisions are based upon a different set of dates for your asset purchases. Bonus depreciation on new equipment is based upon the date that you actually purchase and place in service the asset. For new assets bought between January 1, 2012 and December 31, 2012, you are entitled to use […]
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Farm Income Not Cash Rent!
Continuing our farm income averaging trend, we had a couple of readers ask if they could farm income average their cash rented ground. The short answer is no. In order to use farm income averaging, you must have “farm income” which is comprised primarily of the following items: Direct farm income from Schedule F, Flow-through […]
