Tax Update to Start 2012

2011 Tax Update

Carnival of Taxes 94

Welcome after three weeks away. For a summary of some important posts by other bloggers in the interim, link to the Carnival of Taxes above.

Bonnie Lee of Fox Business provides alerts about a number of 2011 filing season changes and issues to look for in 2012. Base filing date this year is April 17 instead of the (more or less) usual April 15. For those with quarterly payments to make, January 17 (moved back for Sunday and Martin Luther King Jr. holiday) is the due date for the fourth quarter. A new Form 8949 spells out basis in shares sold (for Schedule D purposes). The business rate for mileage went from 51 to 55.5 cents at July 1, 2011; other rates are $0.23 per mile for medical and moving and 14 cents for charity. The maximum earnings subject to FICA is now $110,100, up $3300 from last year. While the payroll tax cut handled so clumsily by Republicans last fall continues for at least two months; the Making Work Pay credit is gone and the first-time homebuyers credit is now restricted primarily to military families. Finally, self-employed taxpayers will find that the health insurance adjustment returns as a "toward AGI" deduction instead of enjoying last year's status as an offset against self-employment tax.

Ms. Lee has provided a useful and concise summary of significant tax law changes. For an election, 2012 may have more adjustments in tax law than typical for a presidential election year, since many thorny decisions were effectively punted last year.