Kamis, 26 Februari 2009

Overlooked Tax Deductions for Last-Minute Filers

Posted on Wednesday, April 2, 2008, 12:00AM
At this time of year, many people fear not finishing their tax returns on time, or getting hit with a big bill they can't cover. My worry is the tax code itself -- the thing is so big, so complex, with such a random assortment of deductions and credits, that I'm sure I'm missing something.

Overlooked = yang dilewatkan
assortment = bermacam-macam / sortiran

For instance, when my husband and I switched accountants a few years ago, the new one asked if we put money away for college. I told her we contributed to 529 college savings accounts in New York. She told me our previous accountant hadn't taken the state tax deduction we were entitled to on our prior-year return.

entitled = yang diberi hak/judul

Tax Yourself on Deductions
The roughly one-third of Americans who itemize their returns typically know about the big deductions -- mortgage interest, charitable giving, qualified retirement-related contributions. But there are a whole host of other categories that many people overlook.

roughly = dengan kasar

I use a professional for fear that I'm not maximizing my deductions (and the fact that my husband and I both run our own businesses), and an estimated 40 million people rely on tax software. If you don't use either -- or if your tax preparer makes minimal inquiries about your finances -- here are some questions to ask yourself so you don't miss opportunities to reduce your 2007 tax bill:

• Did you refinance your mortgage last year?
Any "points" you paid to reduce your mortgage interest rate are deductible, along with your mortgage interest. Did you pay a prepayment penalty to get out of your old mortgage? That may be deductible as well.

If you purchased a new home, don't forget to look at your closing statement and deduct the real estate taxes paid at closing and any points on your mortgage.

• Did you have a major medical problem in 2007?
The IRS allows you to deduct medical expenses that surpass 7.5 percent of your adjusted gross income. That sounds like a lot -- someone making $60,000 could deduct any expenses beyond $4,500. But the IRS has an extensive list of what qualifies as medical expenses.

Health insurance premiums you pay out of pocket, co-pays, prescriptions, and lodging for medical purposes (up to $50 per person) are all deductible, as are therapies to stop smoking. In addition, if you had to drive to the doctor's office, an X-ray facility, physical therapy, or a medical supply store to pick up crutches or a wheelchair, you can deduct the miles you drove, parking, tolls, and the like. Even a portion of your insurance premiums for long-term care can be deducted.

prescriptions = resep obat
lodging = penginapan
pick up = mengambil
crutch = kb. tongkat ketiak. 2 penolong. 3 penyokong, penopang.

• Do you work at home, and have an office that's exclusively devoted to work?
If so, you can deduct a percentage of your rent or mortgage, utilities, homeowner's insurance, and maintenance for the room. Just make sure it's your primary office, and doesn't double as a guest suite on weekends, says New York CPA Eliot Lebenhart.

devote = kkt. 1 mencurahkan. 2 bertekun. 3 menyediakan. to be devoted to sayang akan adiknya yang perempuan.

"You have to have the production of your income take place there," Lebenhart explains. "I do a lot of work in the entertainment businesses, and I don't deduct it because my clients are usually just doing record-keeping there, they're not performing or modeling in the home." Also, if your employer provides a space for you at work and the home office is merely for convenience, don't take the deduction, he says.

Lebenhart says states are becoming aggressive about auditing on home offices so they don't miss out on revenue. New York managed to collect income tax from an employee who worked and lived in Tennessee (he telecommuted and was only in his New York office 30 days during the year). It also collected state income tax from a college professor who taught a day or two in the state but otherwise worked at home in Connecticut.

taught = yang diajar

• Did you pay any bills related to education for yourself or dependents?
You can deduct up to $2,500 of the interest on a student loan. Depending on your income, you can take advantage of the Hope Credit for qualified expenses for the first two years of undergraduate education or the Lifetime Learning Credit from sophomore year through graduate school. (You can't claim both simultaneously.)
Your state may offer additional tax benefits related to educational expenses.

• Did you pay for child care for a kid under age 13 while you worked full-time?
You can deduct expenses up to $3,000 related to a babysitter, day care center (including after-care services at your child's school), and summer day camp.


• Did you buy a car or boat in 2007?
The IRS allows taxpayers to deduct either their state income tax or sales tax, whichever is higher. (Clearly the big winners here are residents of the nine states that collect no income tax, such as Nevada and Florida.) To figure out if the sales tax deduction makes more sense than deducting state income tax, check out this tool.

• Did you make home improvements to boost energy efficiency in 2007?
The IRS offers a $500 credit to property owners who upgraded windows, doors, roofs, insulation, HVAC equipment, and non-solar water heaters last year. (This IRS provision has expired, so you had to do the work in 2007; you can still get credit on next year's return for solar water heaters and panels installed in 2008, however.)

The More the Merrier
The IRS also has a plethora of "Miscellaneous Deductions," including many work-related expenses that aren't reimbursed by your employer. You can claim only the amount of these expenses that total more than 2 percent of your adjusted gross income:

plethora = kb. kebanyakan, berlebih-lebihan. a p. books buku-buku yang kebanyakan.

• Did you search for a new job in your field?
Even if you were unsuccessful in your quest, you can deduct expenses for the phone, travel, employment agency and job counseling, resume preparation, copies, and postage. (You can't take this deduction if you're searching for your first job out of college or are changing careers.)

quest = kb. 1 penyelidikan. 2 pencarian. the q. for knowledge mencari ilmu pengetahuan. to go in q. of s.o. pergi mencari seseorang.

• Did you have to travel or buy work-related clothing or supplies?
You can deduct expenses related to travel that your employer does not reimburse (even those related to getting a passport). You can also take depreciation on a cell phone or home computer your employer requires for work-related needs.

Subscriptions to industry publications and professional journals, and legal fees related to doing or keeping your job (such as a contract negotiation), are also deductible.

So are union dues, uniforms, protective gear, tools, equipment, or other work-related clothing and supplies. (Watch out on uniforms -- a nurse's uniform can be deducted, but not something adaptable for other uses like a formal white shirt and black pants required to work as a waiter.)

union = kb. penyatuan, perpaduan. u. of hydrogen and oxygen perpaduan hidrogen dan oksigen. 2 serikat sekerja. 3 koperasi. 4 (wedlock) perkawinan.
due = kb. hak. She never asks for more than her d. Dia tak pernah meminta lebih daripada haknya. -dues j. iuran. -ks. seharusnya

• Did you pay for job-related continuing education?
"You can take this deduction if it helps you maintain your position, but not if it's to get you a new position," says Lebenhart.
For instance, an accountant who wants to take the CPA exam can't deduct the cost of the review course. But once he becomes a CPA, he can deduct the cost of continuing education required to maintain his CPA certification.

A Word on Documentation
Be sure to hang onto the receipts related to tax deductions for at least three years. If you already filed and missed a hefty deduction, you have three years to file an amended return.


hang onto = menggantung/kan ke
hefty = kokoh / kuat

Artikel ini ditulis oleh Laura Rowley, yang ditulis di http://finance.yahoo.com/expert/article/moneyhappy/74755

Senin, 23 Februari 2009

Alternative Minimum Tax (AMT) - Part I

copy paste ini seperti biasa dari http://finance.yahoo.com/how-to-guide/taxes/136786
Sebenarnya, ingin sekali saya menejemahkan ke dalam bahasa indonesia, mungkin bisa, tetapi saya akan tertawa membacanya.

The AMT was originally devised to help prevent high income filers from avoiding tax altogether through the clever use of various deductions. The AMT effectively takes back some of the tax breaks allowed for regular tax purposes. The only way to really tell if you are "caught" in the AMT is to determine your regular tax liability, then your AMT liability and see which is higher. In true IRS spirit, the higher liability is the one you pay.

devised = difikirkan

Topics
The AMT -- An Overview
Computing Alternative Minimum Tax on Form 6251
Adjustments for AMT
Standard Deduction and Personal Exemptions Not Allowed
Certain Itemized Deductions Disallowed for AMT Purposes
Mortgage Interest
Taxes
Medical Expenses
Miscellaneous Deductions
Investment Interest
Incentive Stock Option (ISO)
Other Adjustments
1
The AMT -- An Overview
The AMT is an additional tax that you may owe if for regular tax purposes you claimed:
Itemized deductions, such as taxes, interest on home equity loans used for nonresidential purposes, medical expenses, and miscellaneous job and investment expenses.
Certain tax-exempt interest, accelerated depreciation, and incentive stock option benefits.
A substantial number of exemptions for dependents.
There are no specific tests to determine whether or not you are liable for AMT. You must first figure your regular income tax and then see whether tax benefit items must be added back to taxable income to figure alternative minimum taxable income, on which the AMT is figured. If after claiming the AMT exemption and applying the AMT rates of 26% and 28% the tentative alternative minimum tax exceeds your regular income tax, the excess is your AMT liability, which is added to the regular tax on your return. In other words, your tax liability for the year will be the greater of your regular tax or your AMT.
AMT liability is figured on Form 6251 and is attached to Form 1040. If you file Form 1040A, AMT liability, if any, is figured on a worksheet and the AMT is entered on the line for total tax on Form 1040A.

2
Computing
You use Form 6251 to compute AMT liability,if any.
AMT adjustments and preferences are generally added back to regular taxable income to calculate alternative minimum taxable income (AMTI). The items that most commonly get added back to income when calculating AMTI are personal exemptions, state and local taxes, and miscellaneous itemized deductions.
AMTI is reduced by the allowable AMT exemption. Subject to the phaseout rule, the exemption for 2008 is $46,200 if single or head of household, $69,950 if married filing jointly or qualifying widow(er), or $34,975 if married filing separately.
After reducing AMTI by the allowable exemption, a 26% AMT rate generally applies to the first $175,000 of AMT income ($87,500 if married filing separately), and a 28% rate applies to any balance of the AMT income. However, if you had net capital gains that qualify for reduced capital gains rates, you apply the same capital gains rate for AMT purposes as for regular income tax purposes.
The resulting tax, less any AMT foreign tax credit, is the tentative AMT, which applies only to the extent it exceeds your regular income tax. For this purpose, regular income tax is the tax on your taxable income, without taking into account personal credits (such as the child tax credit or education credits), minus any special averaging tax on a lump-sum distribution or any regular foreign tax credit. The excess of tentative AMT over this regular tax, if any, is the AMT liability that you must report as an additional tax on Line 45 of Form 1040.

3
Adjustments for AMT
The starting point for figuring AMT is your adjusted gross income from Form 1040. This amount will generally be increased by adjustments on Form 6251. The adjustments are outlined in each section below. Back to top
4
Standard Deduction and Personal Exemptions Not Allowed
If you claimed the standard deduction for regular tax purposes, the deduction is disregarded when figuring AMT liability. You also must disregard the personal exemptions claimed for regular tax purposes. Back to top
5
Certain Itemized Deductions Disallowed for AMT Purposes
Some key itemized deductions claimed on Schedule A are disallowed or reduced when figuring alternative minimum taxable income (AMTI) on Form 6251. For example, no AMT deduction is allowed for state and local income (or, if elected, sales) taxes, real property taxes, or personal property taxes, or for foreign income or real property taxes. Also not allowed for AMT purposes are miscellaneous itemized deductions that were allowed on Schedule A after application of the 2% AGI floor. A smaller deduction for medical expenses is allowed for AMT than for regular tax purposes. The deduction for interest on home equity mortgage loans may have to be reduced. Investment interest may have to be refigured for AMT.
On the other hand, if some of your itemized deductions were disallowed on Schedule A by the 3% reduction rule for taxpayers with adjusted gross income over $159,950 ($79,975 if married filing separately), the disallowed amount is entered as a negative adjustment to AMTI. Back to top
6
Mortgage Interest
Less interest may be deductible for AMT purposes than for regular tax purposes. If an interest deduction is claimed on Schedule A for debt that does not qualify under the AMT rules, that interest is added back as an adjustment on Form 6251.
No AMT adjustment is required for home mortgage interest paid on a debt incurred to buy, construct, or substantially rehabilitate your principal residence or qualifying second residence. The residence may be a house, apartment, cooperative apartment, condominium, or mobile home not used on a transient basis. Nor is an adjustment required for interest on a debt incurred before July 1, 1982, provided that the mortgage was secured at the time it was taken out by your principal residence or any other home used by you or a family member. Back to top
7
Taxes
State, local, and foreign taxes deducted on Schedule A must be added back to income in figuring AMT. If in 2008 you received a refund of taxes deducted in a prior year and the refund is reported as income on your 2008 Form 1040, you enter the refund on Form 6251 (Line 8) as a negative adjustment in figuring alternative minimum taxable income. Back to top
8
Medical Expenses
If medical expenses in excess of the 7.5% AGI floor are deducted for regular tax purposes, you must add back to income on Form 6251 the smaller of the allowable medical deduction from Schedule A or 2.5% of adjusted gross income. This adjustment is to allow medical expenses as an AMT deduction only to the extent that they exceed 10% of AGI. Back to top
9
Miscellaneous Deductions
In figuring alternative minimum taxable income (AMTI), you may not deduct miscellaneous itemized deductions in excess of 2% of adjusted gross income that you claim on Schedule A. These include unreimbursed job expenses, tax preparation fees, and contingent legal fees paid to recover taxable damages in employment or personal legal actions. Back to top
10
Investment Interest
If for regular tax purposes you claimed an itemized deduction (Schedule A) for investment interest on Form 4952, you must complete a second Form 4952 to determine if your allowable deduction for AMT is more or less than the itemized deduction, taking into account AMT adjustments and preferences. The difference between the regular tax deduction and the allowable AMT deduction is entered on Form 6251 as a positive adjustment if the regular tax deduction is more, or as a negative adjustment if the AMT amount is more. For example, if you paid interest on a home equity loan whose proceeds were invested in stocks or bonds, that interest is not treated as investment interest on Form 4952 when figuring the itemized deduction for regular tax purposes, but it is included as investment interest on the second Form 4952 used to figure the allowable AMT amount. Back to top
11
Incentive Stock Option (ISO)
For regular tax purposes, you are not taxed when you exercise an incentive stock option (ISO). However, the exercise of an ISO can result in a substantial AMT liability. You generally must increase AMT income by including on Form 6251 the excess, if any, of:1. The fair market value of the stock acquired through exercise of the option (determined without regard to any lapse restriction) when your rights in the acquired stock first become transferable or when these rights are no longer subject to a substantial risk of forfeiture, over2. The amount you paid for the stock, including any amount you paid for the ISO used to acquire the stock.Note: If you acquire stock by exercising an ISO and you dispose of that stock in the same year, the tax treatment under the regular tax and the AMT is the same. No AMT adjustment is required. If you exercised ISOs in the past and have an unused minimum tax credit, there is a refundable credit for 2008 for a portion of this old credit. The credit rules are explained on Form 8801. Back to top
12
Other Adjustments
Adjustments must also be made for:
MACRS depreciation
Mining exploration and development costs
Circulation costs
Long-term contracts
Amortization of certified pollution control facilities
Research and experimental expenditures
Passive tax-shelter farm losses
Passive losses from nonfarming activitiesBack to top
Summary
The AMT effectively takes back some of the tax breaks allowed for regular tax purposes.
There are no specific tests to determine whether or not you are liable for AMT. You must first figure your regular income tax and then see whether tax benefit items must be added back to taxable income to figure alternative minimum taxable income, on which the AMT is figured.
AMT adjustments and preferences are generally added back to regular taxable income to calculate alternative minimum taxable income (AMTI). The items that most commonly get added back to income when calculating AMTI are personal exemptions, state and local taxes, and miscellaneous itemized deductions.

Stimulating Work

by Andrea CoombesTuesday, February 17, 2009provided by marketwatch

Taxpayers may need to plan ahead for breaks in stimulus bill.
If you ever needed a reason to sit down and do some tax planning, the new $787 billion fiscal stimulus bill -- including some $300 billion in tax breaks -- is a good one.

Jika tax cut = potongan pajak, tax relief = pembebasan pajak, tax break sangat aneh jika diartikan pajak retakan?

From an earlier-than-usual red flag on who might fall into the alternative minimum tax this year to a new question on paycheck withholding, the bill President Obama signed Tuesday should prompt taxpayers to consider how best to lower their taxes in the year ahead.
Of course, there are some straight-up tax breaks that don't necessarily require much tax planning per se.
Unemployed people will find their first $2,400 of benefits is untaxed, and they may qualify for reduced health-insurance premiums through their former employer's group plan, or Cobra.
There's the $8,000 tax credit for first-time home buyers who buy between Jan. 1 and Dec. 1, 2009 -- this credit doesn't have to be paid back, unlike the $7,500 perk available in 2008

But there is one aspect of the home-purchase credit that could require planning: You can claim the credit on your 2008 taxes, even if you bought the house in 2009, according to Mark Luscombe, a principal analyst with CCH Inc., a Riverwoods, Ill., tax publisher and unit of Wolters Kluwer.
"There may need to be a little IRS instruction in that regard because the [2008] forms and instructions probably don't at present contemplate an $8,000 credit," he said. "But it is fairly clear that making that election will not change the 2009 purchase to a 2008 purchase." The home-buyer credit starts to phase out for taxpayers with adjusted gross income above $75,000 for single filers and $150,000 for joint filers, according to CCH.
Then, there's the above-the-line deduction for sales tax paid to buy a new car in 2009. You can only deduct the tax on the purchase price up to $49,500. Luscombe warns that taxpayers shouldn't take both this deduction and the itemized deduction for state sales tax. This deduction on a car purchase phases out at AGI of $125,000 for single files and $250,000 for joint returns. According to CCH, the new-car credit is only for vehicles bought on or after the law's effective date.
AMT Relief
Thanks to the stimulus bill, taxpayers now know the precise alternative-minimum tax exemption amounts earlier than usual. For the past few years, Congress has waited until year's end to pass the "patch" that prevents more taxpayers falling into this parallel tax system. The exemption reduces the amount of income taxed at the AMT rate.
Knowing the 2009 exemption amounts now -- $70,950 for joint filers and $46,700 for single and head-of-household filers -- gives taxpayers more time to run scenarios to see where their tax bill is likely to fall, and figure out how to lower that bill. (Absent a patch this year, those figures would have gone back down to just $45,000 for couples filing jointly and $33,750 for individuals, according to CCH.)
"This expected bit of tax help probably won't have a very stimulative effect, but it will lessen uncertainty and help people plan their tax moves earlier in the year," Luscombe said.
"As a result of the AMT exemption amounts going up, fewer people should be subject to the AMT," said Greg Rosica, tax partner at Ernst & Young LLP, in a conference call with reporters Friday.
Credit for Workers
Those taxpayers eligible for the "make work pay" credit -- up to $400 for single workers and $800 for couples -- may want to assess their withholding before this credit starts showing up in their paychecks.
The credit, available in 2009 and 2010, was trimmed to $400 per worker per year, from a draft stimulus bill's $500 payout.
The credit begins to phase out for single filers with adjusted gross income of $75,000 and married-filing-joint filers with AGI of $150,000. The credit isn't available to taxpayers with AGI topping $95,000 for single filers and $190,000 for joint filers, according to CCH.
It's still uncertain exactly how the credit will be paid out. While some tax experts say employers will automatically adjust workers' paychecks, others say that's not so.
"There's supposed to be a choice between having it as a credit on your tax return or having it deducted from your payroll taxes," Luscombe said. "I would think the employee would have to make some input on that regard, rather than having the employer automatically start the deduction. Some people have suggested maybe a revised W-4 would have to be submitted [to] reflect the employee's choice."
That means workers will need to decide whether they want the money in their paycheck or as a tax refund later. Given the variability of individual's tax situations, some taxpayers could find the credit leads to a larger-than-expected refund come tax time in April 2010 -- or a bill for money owed (if, say, a couple's overall income picture means they're not eligible for a credit but a spouse received one anyway).
Meanwhile, some fixed-income people -- including those who receive Social Security, railroad retirement benefits and veterans' benefits -- will get a one-time $250 payment, a decrease from $300 in an earlier draft of the bill.
Child and Education Breaks
Got kids? If you're a lower-income taxpayer, you may benefit from the expanded child tax credit. This refundable credit, worth up to $1,000 per child, now starts kicking in on income of $3,000 and up, compared to current law of $8,500 and higher, according to CCH. Lower-income taxpayers also get the benefit of an expanded earned income tax credit.
Meanwhile, more higher-income taxpayers get access to the valuable Hope college-education credit, expanded to $2,500, up form $1,800 currently, and renamed under the stimulus bill to the American Opportunity Tax Credit.
"It's figured as 100% of eligible expenses to $2,000 plus 25% of expenses above $2,000, so someone with total eligible expenses of $4,000 or more would reach the maximum amount," according to a press release by CCH.
The credit phases out when adjusted gross income hits $80,000 for single filers or $160,000 for joint filers. That means more people are eligible: Under current law, the Hope credit phase-out in 2009 starts at $50,000 for single filers and $100,000 for married filers.
Breaks for the Bus Ride
Mass-transit commuters get a bigger benefit, too. Right now you can pay some of your commuting costs with pre-tax dollars -- if your employer offers this perk. The stimulus bill raises the maximum dollar amount eligible under this perk to $230 for transit passes and van pooling, up from $120, according to CCH. The change brings up the transit limit to match the $230 already allowed for parking costs.
Business Breaks
The stimulus bill reduces the required estimated tax payments people in business must make for 2009. "It does not eliminate any of the tax you have to pay," Rosica said. "You're still responsible for your full tax bill come tax filing time for 2009, but it does allow more of a conservation of cash throughout the year."
And there are more perks for small businesses in the bill, including an extension of the current Section 179 expense and the bonus depreciation provisions.
That other stimulus bill in 2008 increased the Section 179 expense deduction to $250,000 from $128,000, and offered 50% bonus depreciation, allowing certain businesses to immediately write off one-half of the cost of a capital expense. This stimulus bill allows those perks in 2009 as well.
Small firms also benefit from the net operating loss carry-back provision, which allows them to use existing losses to offset taxes paid on profits in previous years. Already, firms could do that for the two most recent years, but the stimulus bill expands that to five years.
While early drafts of the stimulus plan offered that break to all companies, the final bill limits it to those with $15 million or less in gross revenue.
That's a big hit to bigger companies who were hoping to collect some quick cash to invest back into their firms, said Clint Stretch, managing principal of tax policy at Deloitte Tax.
And some say lawmakers might have missed a chance to stimulate greater business activity.
"Our best estimate is that taxpayers with less than $15 million of gross receipts are 98% of all corporations, but only 5% of taxable income, so Congress has covered most corporations, but not the ones who account for 95% of corporate tax activity," Stretch said in an email message Friday.
Andrea Coombes is an assistant personal finance editor for MarketWatch, based in San Francisco.
Copyrighted, MarketWatch. All rights reserved. Republication or redistribution of MarketWatch content is expressly prohibited without the prior written consent of MarketWatch. MarketWatch shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Minggu, 22 Februari 2009

Common Tax Credits

Saya fikir, saya benar2 tidak ada kerjaan meng copy paste segala sesuatu pajak di luar negeri. berikut ini cp dari http://finance.yahoo.com/how-to-guide/taxes/137106
Ingin sekali saya menterjemahkannya dan mengcomparenya dengan pajak di Indonesia, tapi ada daya english skill belum sampai. mudah2an suatu ketika bisa menterjemahkannya.

After you determine your income tax liability, you may be able to reduce that liability by claiming one or more tax credits. Most personal tax credits are allowed to the full extent of your regular tax liability and alternative minimum tax. But it is important to note that they do not create a refund if they exceed your tax liability. Nonrefundable credits include the child tax credit, dependent care credit, adoption credit, education credits, retirement savings credit, credit for the elderly and disabled, mortgage interest credit, and D.C. first-time homebuyer credit. Refundable credits include the additional child tax credit, the earned income credit, the health coverage credit, and the long-term unused minimum tax credit. If the credit exceeds your tax liability, you will receive a refund for the excess.


Topics
Child Tax Credit for Children Under Age 17
Child and Dependent Care Credit
Adoption Credit
Residential Alternative Energy Tax Credits
Tax Credit for Hybrid Vehicles
Long-Term Unused Minimum Tax Credit
Credit for Retirement Plan Savers

Children Under Age 17
For 2008, you generally may claim a tax credit of $1,000 for each qualifying child who is under age 17 at the end of 2008. To figure the exact amount of your credit, however, you must complete the "Child Tax Credit Worksheet" in the IRS instructions to Form 1040 or 1040A to determine if the credit is limited by your tax liability. Even if the credit does exceed your tax liability, part or all of the credit may be refundable as an additional credit on Form 8812 if your earned income for 2008 exceeds $8,500 or you have three or more children.
The credit may also be limited if your adjusted gross income (AGI) exceeds the $55,000, $75,000, or $110,000 phase-out threshold for your filing status. If your AGI exceeds the threshold, the IRS instructions direct you to the worksheet in Publication 972, where the phase-out rules and other credit limitations are applied. Back to top
2
Child and Dependent Care Credit
Did you hire someone to care for your children or other dependents while you work? If so, you may qualify for a tax credit for the expenses. You may claim the credit even if you work part time. The credit is generally available to the extent you have earnings from employment. If your employer has a plan qualifying you for tax-free child care, and if you are covered, you may be unable to claim a tax credit.
The credit is claimed on Form 2441 if you file Form 1040, or on Form 1040A, Schedule 2. The size of the credit depends on the amount of your care expenses, number of dependents, and income. Depending on your adjusted gross income, the credit is 20% to 35% of up to $3,000 of care expenses for one dependent and up to $6,000 of expenses for two or more dependents. The minimum credit percentage of 20% applies if your adjusted gross income exceeds $43,000. Back to top

The Adoption Credit
tax credit of up to $11,650 may be available on your 2008 return for the qualifying costs of adopting a child under age 18, or a person who is physically and mentally incapable of self-care. The credit is phased out ratably for those with modified adjusted gross income between $174,730 and $214,730.
The credit is claimed on Form 8839. If you paid qualifying adoption costs in 2008 but the adoption was not final at the end of the year, the credit may not be claimed on your 2008 return.
If your employer pays your adoption expenses through a qualifying plan, you are able to exclude this money from your income, subject to rules similar to that of the credit. If you receive employer adoption benefits that are less than your qualifying adoption expenses, you may be able to claim the credit on Form 8839.


4
Residential Alternative Energy Tax Credits
The installation of solar panels and certain other alternative energy property to your main home may entitle you to a tax credit of 30% of the cost, with a top credit of $2,000.
Note: After 2008, the dollar limit is removed. Back to top
5
Tax Credit for Hybrid Vehicles
The alternative motor vehicle credit includes credits for hybrid vehicles purchased in 2008. The amount of the credit depends on the vehicle's fuel economy and the projected lifetime fuel savings and is fixed by the IRS. The maximum hybrid vehicle credit under the law is $3,400, but thus far, the highest certification has been $3,150.
How to qualify for the hybrid credit: Only the original purchaser of a new qualifying hybrid vehicle may claim the hybrid vehicle credit. If you lease a qualifying vehicle, only the leasing company (and not you) may claim the credit.
The hybrid vehicle credit is subject to phaseout on a manufacturer-by-manufacturer basis.
Once a manufacturer sells its 60,000th hybrid vehicle after 2005 (all models), the tax credit for any of that manufacturer's certified hybrids is reduced as follows: For the second and third calendar quarters after the quarter in which the 60,000th qualifying vehicle is sold, you may claim 50% of the credit. For the fourth and fifth calendar quarters, you may claim 25% of the credit; no credit is allowed after the fifth quarter. For example, Toyota (which includes Lexus) vehicles no longer qualify for a tax credit.
The credit for qualifying vehicles is claimed on Form 8910. Back to top
6
Long-Term Unused Minimum Tax Credit
Employees who exercise incentive stock options do not report income for regular tax purposes. However, the spread between the exercise (strike) price and stock price is an adjustment for the alternative minimum tax (AMT). Unfortunately, some individuals exercised options when the stock price was high, only to sell when the price declined, suffering an economic loss while still paying significant AMT tax.
For 2008, such individuals may claim a refundable credit. The long-term unused minimum tax credit is claimed on Form 8801. Back to top
7
Credit for Retirement Plan Savers
Those who contribute to a 401(k) plan or an IRA may gain a second tax break (in addition to the salary deferral for the 401(k) contribution or the deduction for the IRA contribution) -- a tax credit. The credit is claimed on Form 8880. The maximum credit is 50% of a contribution up to $2,000, for a top credit of $1,000.
The top credit applies only to those with modified adjusted gross income (MAGI) below a set amount. Those with slightly higher incomes may qualify for a 20% or 10% credit. No credit that can be claimed by MAGI is higher than $26,500 for singles, $39,750 for heads of households, and $53,000 for joint filers.
The credit is claimed on Form 8880. Back to top
Summary
For 2008, you generally may claim a tax credit of $1,000 for each qualifying child who is under age 17 at the end of 2008.
If you hire someone to care for your children or other dependents while you work you may qualify for a tax credit for the expenses.
A tax credit of up to $11,650 may be available on your 2008 return for the qualifying costs of adopting a child under age 18.
Making certain alternative energy improvements to your home may entitle you to a tax credit.
The alternative motor vehicle credit includes credits for buying hybrid vehicles.
Those who paid alternative minimum tax in prior years because of exercising incentive stock options may be eligible for a refundable tax credit.
Savers who put money into a 401(k), IRA or other similar plan may qualify for a tax credit.

A Dozen Tips for Older Taxpayers

Berikut in copy paste dari http://finance.yahoo.com/news/A-Dozen-Tips-for-Older-usnews-14360288.html


  • Friday February 13, 2009, 3:31 pm EST

Although the government's stimulus program will provide tax relief in 2009, older taxpayers won't get any breaks on their 2008 returns. And after a year of wrenching losses on investments and falling home prices, the memory of 2008 may be particularly bitter at tax time. Still, the goal remains to pay as little tax as possible, so U.S. News asked H&R Block tax expert Gil Charney, principal tax researcher at the company's Tax Institute, some of this year's commonly asked tax questions. Topics include IRAs and 401(k)s, Social Security, Medicare drugs, estate taxes, long-term care insurance, home deductions, charitable contributions and divorce.

tax relief artinya pembebasan pajak, adalagi istilah lain seperti tax cut yang artinya pemotongan pajak,

wrenching artinya kunic inggris, pilinan,, maksudnya apa.., saya ga ngerti.

bitter = pahit

divorce = perceraian

Q: The government has relaxed mandatory minimum withdrawals from IRAs for taxpayers who turn 70½ in 2009. Is there anything I should do with my 2008 tax returns to prepare for this change in 2009?

A: Since the new law affects 2009's required minimum distributions (NYSE: RMD - News) only, there is no action or decision that can be made to affect 2008's return. However, here are a few comments about this new law: a) If a taxpayer turned 70½ in 2008, he or she would be required to take a distribution for 2008. The deadline for which is April 1, 2009. The taxpayer still needs to take this distribution. Even though the distribution is taken in 2009, it is a required distribution for 2008. To avoid penalties, taxpayers should take the distribution; b) Required minimum distributions are still optional. If taxpayers need to take a distribution for living expenses, they can take any amount desired. Even if the required distribution is waived for 2009, any non-Roth distribution is still taxable; c) There is no "catch-up" or double minimum distribution requirement in 2010. However, for taxpayers who turn 70½ in 2009, the 2010 RMD will still need to be distributed by Dec. 31, 2010.

Q: I participate in the Medicare Part D prescription drug program, but am totally confused about how to handle drug expenses on my tax return, particularly the so-called "doughnut hole." Can you help me out?

A. The "doughnut hole" has no specific tax implications. However, once taxpayers reach the doughnut hole in Medicare Part D, they must pay out-of-pocket costs for prescriptions, which are tax deductible. All out-of-pocket costs for prescriptions, whether part of a deductible, co-pay, or full prescription costs while in the doughnut hole, are qualified medical expenses that may be deducted to the extent all medical expenses exceed 7.5 percent of the taxpayer's adjusted gross income. In addition to out-of-pocket costs for Medicare Part D, premiums paid for Medicare Part B and Part C (Medicare Advantage) also are deductible. If taxpayers applied for Medicare Part B at age 65 or after disability, they can deduct the monthly premiums. (Note: Normally, Medicare Part B premiums are not paid directly by the taxpayer but are withheld from his Social Security benefits. The amount withheld is shown on the taxpayer's Form SSA-1099, box 3. If the taxpayer is preparing his own return, he should not forget to include these expenses as a medical deduction.

Q: I'm 64 and drawing down Social Security; my full retirement age is 66. Can you explain how I should handle taxes on any outside income I earn?

A. There are two issues when drawing Social Security before full retirement age. The first issue is the effect of outside income on Social Security benefits. Income earned above a certain threshold will reduce Social Security benefits if the taxpayer is under his full retirement age. The second issue is the taxability of those benefits. Benefits for taxpayers who are under full retirement age and collecting Social Security are reduced by $1 for every $2 earned over a certain limit, which is $13,560 in 2008. For example, if a 62-year-old taxpayer receiving Social Security benefits earns $17,000 at a part-time job and has Social Security benefits of $10,000, the Social Security benefits would be reduced by $1,720 (17,000 - $13,560 ÷ 2 = $1,720). Thus, he would receive only $8,280 ($10,000 - $1,720). In addition, a portion of a taxpayer's Social Security benefits is taxed if the taxpayer's income is above a certain "base amount" (which varies according to filing status). Significant outside income could cause as much as 85 percent of Social Security benefits to be taxed. If taxpayers' income is high enough for their Social Security benefits to be taxed, income tax can be withheld from the payments by filing a Form W-4V. Otherwise, the taxpayers may have to make estimated tax payments.

Q: I understand that the rules for estate taxation may be changing. Can you review the possible scenarios and tell me whether there's anything I should be doing now to get ready for these possible changes?

A. In 2009, the estate tax exclusion is $3.5 million, which means estates in excess of this amount may be subject to the estate tax. However, even if the "gross estate" is larger than this amount, there may not be any estate tax paid. The estate tax exclusion is scheduled for repeal in 2010, which means the estate for anyone who dies in 2010 will not be taxed, regardless of size. In 2011, the exclusion is reduced to $1 million, the same amount in place in 2002. There were about 38,000 estate tax returns filed in 2007, compared to about 138 million Form 1040s in 2006. Although the number of people affected by the estate tax is relatively small, the stakes could be high for them. When compared to the highest individual income tax bracket of 36 percent, the estate tax rate is 45 percent. There are ways to minimize the estate tax, such as making lifetime gifts to children and grandchildren (at or below the annual exclusion of $13,000 per year per person in 2009); using irrevocable trusts to transfer assets-- and control of those assets--to a taxable entity outside the gross estate, and, creating an irrevocable life insurance trust so that the trust receives any life insurance proceeds which could inflate an estate's total value. Anyone with significant assets should consult an attorney competent in estate planning. Not only are the laws complex, but a mistake also can be extremely expensive.

Q: Some friends of mine say they've been told that getting divorced may save them a lot of money in taxes. Is this true for older couples, and under what circumstances?

A. Divorces between elderly couples offer no special tax benefits. In the past, some elderly couples may have used divorce as a tactic to allocate assets to the healthy spouse so that the sick spouse could qualify for Medicaid. However, the Deficit Reduction Act of 2005 disregarded such asset transfers as acceptable tactics to qualify for Medicaid. Again, this is not a tax benefit, but older couples who think this is a viable option should consult an elder-care attorney before seeking a divorce, which creates far more complex issues and often unfavorable results. In some unusual situations, couples may have advantages by filing separate returns (CDNX: MFS.V - News) instead of a joint return (MFJ). For example, if one spouse has high medical bills and a low AGI and the other spouse does not, the spouse with the high medical bills may be able to claim more of a medical deduction because of the 7.5 percent-of-AGI floor. But by filing as MFS, other tax credits and deductions are unavailable or reduced. Married couples can use tax preparation software (or a tax professional) to determine which filing status is best.

Q: I can no longer afford to write checks out to my favorite charities. Is it still possible for me to contribute directly from my IRA?

A. Taxpayers over 70½ may direct a transfer up to $100,000 from their IRAs directly to a qualified charitable organization. This option expires at the end of 2009. Although no charitable deduction may be claimed for such a contribution, the transfer is tax-free to the IRA owner because the transfer is not a distribution.

Q: I'm in my upper 60s but I do not have long-term care insurance. The premiums are just too expensive for me with my limited income. However, I can afford even less the services of a long-term care facility, since that would wipe me out financially. Are there any tax benefits to owning a long-term care policy that might help subsidize the premiums?

A. Long-term care premiums are deductible as a medical expense (subject to the 7.5 percent-of-AGI floor), although there are limits to the deduction based on the taxpayer's age. For example, a taxpayer between ages 61 and 70 may deduct as much as $3,080 in 2008 ($3,180 in 2009). A couple filing a joint return can deduct as much as $6,160 in 2008, if each spouse pays premiums on qualified long-term care policies. Payments in excess of any LTC benefits may be deducted as medical expenses.

Q: I am 72 and retired, disabled and living only on Social Security retirement and disability. These benefits are only $14,000 per year. Are there any special tax benefits I might qualify for?

A. There is a credit for the elderly or the disabled, although few qualify for this credit because the income limit typically results in a very low or no tax liability. Since a credit reduces tax liability dollar for dollar, there is no tax benefit if there is already no tax liability before the credit is computed. If you had no other income, your tax liability would be zero; so while you could qualify for the credit, there would be no real tax benefit for you. There is more information in the IRS' Publication 524, Credit for the Elderly or the Disabled.

Q: I'm in my upper 50s and several years away from retirement, especially in these tough economic times. Can I take a hardship distribution from my 401(k) to help pay for my daughter's tuition? Since the money would be used for tuition, wouldn't I avoid any penalties?

A. No. Your 401(k) may be a lot lower now and college tuition is a good "investment" for your daughter's future, but there is no exception to the 10 percent penalty on early distributions from a 401(k) plan. Even if your employer's plan allows hardship distributions, your distribution is taxable and subject to the 10 percent penalty. If the plan allows, you can to borrow from your 401(k) account with no tax consequence. However, if you cannot repay the loan (which may become immediately due if you are laid off), the loan is considered a distribution and the entire amount becomes taxable and subject to penalty if you are under age 59?.

Q: I am in my mid-70s and would like to make sure my grandchildren's college costs are covered as much as I can afford. Are there any special tax benefits available to me?

A. One possibility might be for you to contribute to (or establish) Section 529 accounts for your children. These tax-advantaged accounts allow distributions that are tax-free if used for "qualified" education expenses, such as tuition, fees, and room and board. You can contribute to their accounts as gifts. You also can "front load" a 529 account. Normally, if you give more than $13,000 to one individual during the year, you need to file a gift tax return on the excess over the $13,000 annual exclusion, which has gift tax implications. However, you may contribute as much as the annual exclusion for five years in a single contribution (if you have the funds to do this)--or $65,000--without any gift tax implications. Finally, if you have a grandchild already attending college, you may pay that individual's college tuition without any dollar limit if you pay the institution directly. If you give the funds to your grandchild to pay tuition or if you are reimbursing the tuition already paid, this option is not available. In this case, you would need to file a gift tax return on the amount over the annual exclusion of $13,000.

Q: I'm 72 and relatively healthy, and I might have to get a part-time job to supplement my income. I have been taking required minimum distributions (RMDs) from my IRA for a few years. Do I have to continue taking them if I go back to work, even part-time?

A. Even though you have "earned income," you must continue taking RMDs (except for 2009, when the requirement was waived). You cannot contribute to an IRA once you reach age 70½, so if you return to work, there is no tax effect on your situation.

Q: Are there any home tax deductions we could take? We're a retired couple with a home and mortgage that's been paid off. However, we still pay real estate taxes on the house and property taxes on our car. We don't itemize on our taxes.

A. Taxpayers in their 60s or 70s with a home and no mortgage often find they cannot itemize their deductions because they don't have enough deductions to make it worthwhile itemizing. However, a new law now allows taxpayers who pay real estate taxes to increase the amount of their standard deduction by the amount of real estate taxes paid, up to $1,000 for a couple filing a joint return. The new law applies only to real estate taxes, not the property taxes paid on your car.

Obama: tax cuts will be felt by April 1

Berikut ini copy paste dari http://biz.yahoo.com/ap/090221/na_us_obama_economy.html?.v=2&.pf=taxes

AP
Obama: tax cuts will be felt by April 1
Saturday February 21, 6:14 am ET
By Liz Sidoti, Associated Press Writer


Obama says people will start reaping benefits of tax cuts in economic stimulus plan by April 1 WASHINGTON (AP) -- The notoriously slow Congress passed the $787 billion economic stimulus package in a matter of weeks. President Barack Obama signed it into law less than one month into his presidency.
So, just how soon will Americans start reaping the benefits of tax cuts in it?

By April 1, according to the president.

"Never before in our history has a tax cut taken effect faster or gone to so many hardworking Americans," Obama said Saturday in his weekly radio and Internet address.

He said the Treasury Department has begun directing employers to reduce the amount of taxes withheld from people's paychecks in accordance with the new law, and that in six weeks, a typical family will start taking home at least $65 more every month.

Obama says his signature "Making Work Pay" tax break will affect 95 percent of working families.

The $400 credit for individuals is to be doled out through the rest of the year. Couples are slated to get up to $800. Most workers are to see about a $13 per week increase in their take-home pay. In 2010, the credit would be about $7.70 a week, if it is spread over the entire year.

People who do not earn enough money to owe income taxes are eligible for the credit, an attempt to offset the payroll taxes they pay.

Obama's expensive and ambitious package of federal spending and tax cuts is designed to revive the economy and save or create 3.5 million or more jobs. It will inject a sudden boost of cash into transportation, education, energy and health care, while aiming to help recession victims through tax cuts, extended unemployment benefits and short-term health insurance assistance. It also will add to a rapidly growing national debt.

The president signed the measure into law Tuesday.

In his weekly address, Obama said he was grateful to Congress, governors, mayors and everyday people who supported the measure.

Still, he added: "It is only a first step on the road to economic recovery. And we cannot fail to complete the journey." He said the country also must stem foreclosures, repair the banking system, get credit flowing again and revamp financial industry regulations.

And, even as he promoted the record-breaking spending plan, he called for doing what's necessary to control "exploding" deficits as the economy begins to improve.

Obama is holding a bipartisan "fiscal responsibility summit" at the White House on Monday to talk about ways to control the trillion-dollar budget deficit. The next day, he will address a joint session of Congress, a speech expected to focus heavily on the economy. On Thursday, Obama will send a budget request to Congress "that's sober in its assessments, honest in its accounting, and lays out in detail my strategy for investing in what we need, cutting what we don't and restoring fiscal discipline."

Republicans are certain to hold him to that.

In the Republican's weekly address, Rep. Dave Camp of Michigan, the top Republican on the House Ways and Means Committee, said his party wants to work with Obama to solve the country's economic problems "in a responsible way that does not burden our children and grandchildren with a mountain of debt."

"We can't borrow and spend our way back to prosperity," Camp said. "If he is serious about dealing with the tough issues and getting spending under control, his budget will show it."

Jumat, 20 Februari 2009

2008 Tax Brackets

Bracket ini = kb. tanda kurung besar, akolade : []. 2 golongan. 3 siku-siku (untuk rak, dsb.). -kkt. 1 mengurung. 2 menggolong, mengumpulkan.

This section discusses how to determine which tax rates apply to your taxable income. You will find that your filing status and taxable income are the primary determinants. We also provide a chart that shows you exactly what your rate will be for 2008.

1. Overview
The most favorable tax brackets apply to married persons filing jointly and qualifying widow(er)s who also use the joint return rates. The least favorable brackets are those for married persons filing separately, but filing separately is still advisable for married couples in certain situations. The table in Topic 4 compares 2008 tax rate brackets.

If you have children and are unmarried at the end of the year, do not assume that your filing status is single. If your child lives with you in a home you maintain, you generally may file as a head of household, which allows you to use more favorable tax rates than a single person. If you were widowed in either of the two prior years and maintain a household for your dependent child, you generally may file as a qualified widow(er), which allows you to use favorable joint return rates.
If you are married at the end of the year but for the second half of the year you lived with your child apart from your spouse, and you and your spouse agree not to file jointly, you may use head of household tax rates, which are more favorable than those for married persons filing separately.

2. What Is Your Top Tax Bracket?
Your top marginal tax rate is 10%, 15%, 25%, 28%, 33%, or 35%, depending on your taxable income, as shown in the table below. If your top bracket is 25%, for example, this means that each additional dollar of ordinary income (such as salary or interest income) will be taxed at 25% for regular income tax purposes

Please note: The tax rate on qualified dividends and net capital gains is generally lower than your top bracket rate on ordinary income. Qualified dividends are subject to a rate of 15% or are tax free, depending on your top bracket, and net capital gains are also generally subject to a rate of 15% or are tax free (depending on your top bracket), but the rate can be higher if you have 28% rate gains or unrecaptured Section 1250 gains.
To actually compute your 2008 regular income tax, you will either look up your tax in the Tax Table, use the Tax Computation Worksheet, or if you have net capital gains or qualified dividends, use the Qualified Dividends and Capital Gain Tax Worksheet or Schedule D Tax Worksheet.

3. Getting Married Can Raise Your Taxes
The so-called marriage penalty is faced by couples whose joint return tax liability exceeds the combined tax they would pay if single. This is generally the case where each spouse earns a substantial share of the total income. On the other hand, if one spouse has little or no income, there is usually a marriage bonus or singles penalty, as the couple's tax on a joint return is less than the sum of the tax liabilities that would be owed if they were single.
Tax legislation has reduced the marriage penalty by increasing the standard deduction for married couples filing jointly to double the amount allowed to a single person and making the 15% bracket twice as wide.

Summary
Your tax rate is determined through a combination of filing status and taxable income.
Married filing jointly is the most tax-favored status.
But, if you are married filing jointly, and both you and your spouse earn a significant share of the total income, you are subject to the "marriage penalty."

http://finance.yahoo.com/how-to-guide/taxes/137352

Minggu, 15 Februari 2009

Taking Responsibility

Tolong dikoreksi, jika judulnya kurang tepat.

Beberapa minggu lalu, saya menabung di sebuah bank. Mungkin karena awal bulan dan pada jam sibuk, suasananya begitu hiruk pikuk. Teller seperti tidak bisa bernapas, semua anggota tubuhnya bergerak secara otomatis dengan tetap berusaha mempertahankan standar pelayanan dengan berusaha senyum meski terkesan dipaksakan dan mengucapkan bahasa standar seperti selamat pagi, ada yang bisa dibantu, uangnya Rp sekian, terima kasih Pak....masih ada lagi yang bisa dibantu. Satpam membuka dan menutup pintu dengan tanpa henti karena begitu banyaknya orang yang masuk dan keluar. Begitu banyaknya orang membuat formulir setoran habis, pulpen untuk menulis pun yang biasanya diikat, entah siapa yang membawanya. hilang entah kemana. Semuanya seperti out of control.

Ditengah suasana crowded tersebut, Seorang pria berdasi, perlente, jelas ia mempunyai kedudukan tingi pada bank tersebut begitu terburu-buru membantu teller, kemudian ke tempat penyimpanan formulir, matanya begitu tajam memperhatikan apa yang kurang dan apa yang semestinya bisa ia lakukan. Tanpa segan ia meminjamkan pulpennya, mencari formulir. Situasi yang memanas perlahan namun pasti menjadi lebih dingin.

Entahlah, apakah pada bank tersebut suatu SOP yang menyebutkan jika suasasa crowded maka pejabat harus ikut repot, saya tidak tahu. Tanpa pejabat bank turun tangan pun sebenarnya suasana akan berangsur membaik dengan sendirinya. Satpam dan para frontliner pasti akan dapat mengatasinya meskipun tentu saja akan mengurangi level kenyamanan nasabah dan merugikan perusahaan dalam jangka panjang.

Perbuatan pejabat tersebut yang mau berepot ria membantu kesana kesini sekilas hal yang biasa dan wajar, bukankah kita harus saling membantu jika ada team yang sedang mangalami kesulitan. Wajar, karena hal ini sangat umum dan tidak ada keistimewaannya.

Namun, ketika ketika kita begitu teguh memegang SOP dan berprinsip elu2-guw2, perbuatan tersebut begitu mulya dan mengangkat derajat pejabat tersebut pada level diatas rata-rata. Ternyata kemulyaan itu begitu sederhana dan dapat dimulai pada hal-hal yang mungkin sepele bagi sebagian orang