David Korn, who writes a weekly newsletter that includes summaries of Moneyalk, summarized Barbara's important points. Posted with David's permission:
1. The deadline is not April 15th, but rather April 17th this year. That’s the deadline to file or request an extension.
2. You can get an automatic 6 month extension without giving a reason — just for asking. You still have to pay as much as you owe to avoid interest and penalties.
3. Don’t look for some of the provisions that were available on 2010 such as the making work pay credit the credit for buying a hybrid vehicle or the first time home buyer credit for most purchasers. Those expired.
4. There are some new forms – Form 8949 to report sales of capital assets such as if you sold stock or mutual fund shares. That form is summarized and carried over to schedule D. There is also 8938 which tells the IRS that you have certain foreign assets.
5. There has been a major tightening up of the scrutiny of capital gains of the IRS.
6. Brokerage firms starting in 2011 were required to report the basis of stocks that were bought and sold and starting in 2012 the basis for mutual fund shares will be reported. This way people can not just make up the basis as the IRS suspects many have in the past.
7. Common mistakes by people who do their own tax forms include: (1) putting in the wrong social security number; (2) failing to report the income that gets reported to them on the 1099 forms. The IRS cross-checks the income that has been reported to them on 1099 against taxpayer returns.
8. If you use a tax preparer to do your tax forms, they now have to file electronically. Now 80% of taxpayers file electronically.
9. The tax code has got more and more complicated. Barbara said this is the 75th year of their publication and each year it gets bigger due to the changes in the law.
10. Barbara said at the end of 2011 more than 50 tax breaks expired and there hasn’t been any action on extending them so we don’t even know if some of those will apply this year such as the higher exemption amounts of the alternative minimum tax. We also don’t know what will happen at the end of 2012 relative to the Bush tax cuts.
11. Starting 2013, individuals with income over $200,000 or couples making over $250,000 will have additional Medicare taxes if the health care law is not declared unconstitutional by the Supreme Court.Here are some more tax changes in 2012: Palisades Hudson Financial Group
And here is a link to the J.K. Lasser web site which has good tax information and all the books published by J.K. Lasser http://www.jklasser.com/http://www.jklasser.com
David Korn's Stock Market Commentary, Interpretation of Moneytalk (Bob Brinker Host), Financial Education, Helpful Links, Guest Editorials, and Special Alert E-Mail Service. Copyright David Korn, L.L.C. 2012Honey here: If you are interested in getting complimentary issues of David Korn's weekly newsletter, and The Retirement Advisor, published by David and Kirk Lindstrom, go here (Look for David's link in the right hand column under "Related Links.") Please see my summary of the first two hours of the show below.
