HomeServicesQuickbooksAboutJoe Hockaday, CPAContactTax Talk Blog
Optima
Newsletters
Testimonials

Don’t let taxation be a frustration

We can help you with all your needs

Call us today….

We can help you with all your income tax needs for:

INDIVIDUALS, BUSINESSES,

NON-PROFITS, ESTATES and TRUSTS

Let us design, clean up or help you maintain and
have the best accounting book.

We offer QuickBooks setup, bookkeeping,
payroll, and sales tax preparation.

Personal, income tax, and QuickBooks Consulting

Are you Self-Employed?

Have kids under the age of 18?

Do you have a family owned business?

Then let our Optima Program help reduce your taxes.

Tax Talk

2013 Passed Tax Legislation

Joe Hockaday - Tuesday, January 08, 2013
Here is a brief synopsis of the recently passed tax legislation:
Tax Changes for 2012 & 2013
1. The Alternative Minimum Tax (AMT) has been permanently indexed for inflation, thereby avoiding the annual legislation
2. Bonus Depreciation on business assets has been extended through 12/31/13. Bonus Depreciation allows a business to deduct up to 50% of the cost of an asset in the 1st year.
3. Long TerCapital Gains and qualified dividends tax rates are kept at 15% for individuals with income up to $400,000 and families up to income of $450,000. The rate rises to 23% of income exceeds those thresholds.
4. Debt forgiveness on residence exclusion is extended for 1 year. Debt forgiven in conjunction with the foreclosure of a principal residence will be considered nontaxable.
5. Certain depreciation provisions are retroactively extended through 2014. These include 15-yr cost recovery of leasehold improvements (including restaurant & retail). Section 179 property and provisions also extended through 2014.
6. Earned Income Credits phaseout limits and credit amounts revert back to lower levels. This means that more taxpayers will qualify for the EIC and a higher benefit will be paid.
7. The first $5.12MM of one’s estate can be transferred to heirs tax-free. The tax rate on amounts exceeding this threshold increase from 35% to 40%. 
8. Income above $400,000 for individuals and $450,000 for families will be taxed at a rate of 39.6%; increasing from 35%
9. Mortgage Insurance premiums will again be deductible as an itemized deduction for 2012 through 2013. Certain income limitations will also apply.
10. The rules that phased out itemized deductions that existed prior to 2011 are reinstated for tax years beginning 1/1/13. During 2011 and 2012 there was no phase out of itemized deductions for higher earners.
11. There is a phase-out of personal exemptions for individual making more than $250,000 and families making more than $300,000. 
12. The state sales tax deduction was reinstated for 2012 and extended to 2013.
13. The 2% “payroll tax holiday” provision was allowed to lapse effective 1/1/13.
14. The $1,000 child tax credit and the $2,500 American Opportunity college tuition credits have been extended for 5 years.
15. The $250 deduction for AGI for Teachers’ classroom expenses was reinstated.
16. The college tuition deduction was revived for 2012 and continues through 2013.

Online Business Partner® by Frisco Websites