ADP SmartPros Webinar New Tax Laws: What to Look for in 2012

Transcription

1 ADP SmartPros Webinar New Tax Laws: What to Look for in 2012 NEW TAX LAWS: WHAT TO LOOK FOR IN 2012 Tuesday, January 17, 2012 accountant.adp.com Making Your Busy Season A Little Less Taxing Stress relief starts with personalized service from your ADP Associate and at Extended hours for ADP s Accountant Help Desk during busy season Complimentary online tools and resources at accountant.adp.com CCH Master Tax Guides and State Tax Guides delivery in January and February to your office 2012 Fast Wage and Tax Facts for your state(s) CCH Federal and Depreciation Key Facts and Figures guides Stress relief and wellness coupons and discounts for you and your staff to survive and thrive Every Practice is Unique So We Offer Many Options Refer your clients to ADP You will continue to provide them with trusted advisory and consulting services while ADP expertly manages their payroll and more. Let ADP process your clients payroll for you RUN ADP Payroll for Accountants is a powerful online application helps you to keep your clients compliant, while providing your firm with a new source of revenue. Sell your payroll base to ADP Put your payroll clients in experienced hands while providing you the opportunity to generate capital and free up time to focus on your practice. Earn Rewards or share revenue for referring your clients ADP s Referral Rewards and Revenue Share Incentive programs offer you the chance to earn points towards valuable gifts or earn revenue for your firm. For more information, contact you local sales representative or LeeAnn.McNeill@ADP.com The following program is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed and sold with the understanding that ADP and SmartPros Ltd. are not engaged in rendering legal, tax, accounting, investment or other expert advice. If expert assistance is required, the services of a competent professional should be sought. The views and conclusions expressed herein are those of the speaker and not necessarily those of ADP and SmartPros Ltd. EXPERT COMMENTATOR: BARBARA WELTMAN Producer, This Week in Taxation 1

2 TO RECEIVE CPE CREDIT: This Webinar qualifies for 1 CPE credit To earn CPE credit, you must enter 4 words / phrases within 24 hours of the Webinar At conclusion of webcast, go to: TAX ENVIRONMENT Tax incentive = economic stimulus Deficit reduction/debt ceiling "No new taxes!" EMPLOYEE SHARE OF PAYROLL TAX 2011: 4.2% x $106,800 = $ : 6.2% x $110,100 = $6826 TEMPORARY PAYROLL TAX CUT CONTINUATION ACT Public Law and IRS IR Two-month extension: until February 29, 2012 Recapture/overwithholding adjustment Form 941 quarterly payments? EXPIRING PROVISIONS: 12/31/2011 AMT: patch; credits against Deduction for state/local sales tax Above-the-line deduction for educators Above-the-line deduction for tuition Tax-free charitable transfers Research and experimentation credit CAPITAL PURCHASES Bonus depreciation 100% 50% Sec. 179 $500,000 $139,000 2

3 WORK OPPORTUNITY TAX CREDIT (WOTC) Traditional 9 target groups Expired on 12/31/2011 VOW TO HIRE HEROES ACT P.L for unemployed veterans hired From 11/22/2011 Thru 12/31/2012 Returning heroes: $2400; $5600 Wounded warriors: $9600 ESTATE TAXES IN 2011 & 2012 Federal exemption amount = $5 million Amounts in excess: taxed at 35% maximum Unified exemption amount lifetime gifts dispositions at death LIFETIME GIFTS ENABLE YOU TO REMOVE Asset from estate Appreciation from estate PORTABILITY IN 2011 & 2012 Unused exemption amount is added to that of surviving spouse only for "last" deceased spouse Requires filing Form 706 TAX VALUE OF GIFTS Judith F. Lang, T.C. Memo Mother pays $25,000 of daughter's medical bills Income tax: deduct as if a gift Gift tax: not a gift since paid directly 3

4 REPORTING FOREIGN ASSETS FATCA FBAR Form IRS 8938 Treas When with 1040 June 30 Regs TD 9567 Notice Reporting Specified foreign Foreign financial financial asset (SFFA) account Threshold S: $50,000/$75,000 $10,000 J: $100,000/$150,000 Penalty $10,000/40% $100,000/50% SPECIFIED FOREIGN FINANCIAL ASSET (SFFA) Financial account maintained by foreign financial institution Stock or security issued by non-u.s. person Financial interest with non-u.s. issuer or counterparty Interest in a foreign entity (or real estate) WORKER CLASSIFICATION Employee (W-2) Independent contractor (1099) VOLUNTARY CLASSIFICATION SETTLEMENT PROGRAM (VCSP) Consistently treated workers as contractors Filed required 1099 forms Are not under IRS audit Are not being audited for worker classification U.S. Labor Department state regulatory agencies VCSP UNDER IRS ANNOUNCEMENT Stick: You pay 10% of last year's employment tax liability no interest charges or penalties file Form 8952 Carrot: You receive amnesty on past audits IS AGREEMENT BINDING ON State regulators unemployment workers compensation FLSA Workforce benefits reimbursement 4

5 TAX PROS AT RISK Home office: Bulas, T.C. Memo Casualty loss: Wuerth, T.C. Summ. Op S corporation reasonable compensation U.S. SUPREME COURT TO DECIDE Proceeds $3,000,000 $3,000,000 Basis ( 1,500,000) ( 500,000) Gain $1,500,000 $2,500,000 3 years: overstatement of basis 6 years: omission of income ROLE OF TAX ADVISER Year-end tax planning Update on changes in tax law: Congress and courts Alert on potential tax changes TO RECEIVE CPE CREDIT: This Webinar qualifies for 1 CPE credit To earn CPE credit, you must enter 4 words / phrases within 24 hours of the Webinar At conclusion of webcast, go to: 5