New Legislation and Updates

NEW - Livestock Sold because of Drought - If you sold more livestock than you normally sell because of the drought, there is tax relief available to you.  Contact us for more information.

NEW - Health Insurance Rebate - some policy holders may be looking at getting a rebate form your health insurance company if the company failed to meet the 80/20 rule that is part of the health care reform law.  This rebate may or may not be taxable to you.  If you receive the rebate, please let your tax preparer know so they can determine if it is taxable to you. 

NEW - HSA's - For 2013 the amount you can contribute will increase to $6,450 for family coverage and $3,250 for individual coverage.  If you were born before 1959, you can put in $1,000 more.  The limits for out-of-pocket expenses are $12,500 for family coverage and $6,250 for individual.  The minimum deductible is $2,500 for family coverage and $1,250 for individual coverage.

NEW - Employer-Owned Life Insurance - Unless the following exceptions are met, employers should treat death benefits in excess of premiums as income (per IRC Sec 101(j) ). 

NEW - Roth IRA and S-Corporations - Do not put S company stock into a Roth IRA.  A Roth IRA is an ineligible S shareholder and will revoke the s status.

NEW - Estates - If you are the executor of an estate that has unpaid taxes and you distribute the assets without paying the taxes, you can personally be liable for the taxes owed.

Mortgage Interest - Interest on a house that was never built is deductible, but only the first 24 months after construction begins.

E-File Regulations for Tax Preparers - Any person that prepares 10 or more tax returns must file them electronically. 

Medical Expenses - If you are paying for a caregiver for a dementia patient or someone that is not able to do at least two of the following six daily living activities (eating, toileting, transferring, bathing, dressing, and continence), these payments qualify as a medical expense.

Payroll Tax Deposits - If you have had trouble making your payroll tax deposits because of financial trouble, you may qualify for abatement of the late deposit penalties.

Partnerships, Estates, Trusts - These tax returns are only granted a five-month extension. 

Per Diem Rates - The IRS has eliminated the high-low method for business travel costs.  Now you must use the federal per diem rates published by the Service every year. 

Non-Profit Organizations - If you credit fundraising amounts against Dues, you may loose your exempt status.

Casualty Loss – If you live in an area that is prone to natural disasters, such as flooding, tornado, etc.   You may want to consider taking pictures or video of your home before a potential disaster strikes.  This will help after in assessing the damage.  If you have been affected by disaster, a list of recognized areas is constantly being updated by the IRS.  To find out if you are located in a disaster area, click here:,,id=98936,00.html

Exempt Organizations – As of June 8, 2011, if you are an exempt organization and have not filed a tax return for the past three years, your tax exempt status has been revoked.  If you are unsure if your status has been revoked the IRS has published a list of all organizations that have lost their tax exempt status and can be found here (,,id=240099,00.html).  If your organization has lost its tax exempt status, it can be reinstated by submitting an application and fee.   

To read the full article, click here:,,id=240239,00.html?portlet=7

Donations – If you donate $250 or more to an organization, you must have written acknowledgement from the charitable organization to deduct the donation. 

For more information about charitable donations, visit:

Return Preparer Registration – The IRS has implemented new regulations for tax return preparers.  All paid preparers must apply for a PTIN.  These regulations require all tax preparers to pass a competency test, and tax compliance and suitability checks.  They will also be required to complete and have continuing education 15 hours of Continuing Education.  The tests and continuing education will begin mid to late 2011.   

Health Care - With the new health care law, employers who provide health coverage to its employees will be required to include on the W-2 the amount the employee paid in health insurance.  In 2011 it is optional for all employers to report this.  In 2012 it will be optional for small businesses (if you issue 250 W-2’s or less). 

1099 Regulations – Currently there are regulations requiring business to send 1099’s for certain business payments and rental property expenses.  This bill is expected to be repealed.  The repeal  has been passed by the Senate and House, and when it reaches the President, he is expected to sign it.

For more information, click here: