Posts Tagged ‘2009’

More Changes For AZ Taxpayers

Friday, June 25th, 2010

July 1 is the start of the Ari­zona State fis­cal year which is why sev­eral changes are going into effect on that date. 

AZ With­hold­ing Tax Change: On July 1, 2010 an employer must with­hold Ari­zona state income tax accord­ing to the new A4s, which they should have obtained from all of their employ­ees prior to that date. We have pre­vously  blogged about the change com­ing to the Ari­zona A4. On July 1st Arizona’s state income tax with­hold­ing rate will decou­ple from the fed­eral with­hold­ing rate. Every employee needs to do a new A4. An employer should not advise employ­ees about how to com­plete the form except to point out the form comes with work­sheet to assist them. That said, a quick and dirty cal­cu­la­tion would be to see how much tax you owed to the state last year and divide it by your Ari­zona state income; but of course this assumes that your income, expenses, mar­i­tal sta­tus, depen­dents, items of credit and deduc­tion, etc. are sim­i­lar to last year, which it may not be.

AZ Child Sup­port Gar­nish­ments Change: If you are an employer who does gar­nish­ments for things like child sup­port in Ari­zona through CLEARINGHOUSE, please be advised that the fee will increase from $2.25 to $5.00  start­ing July 1.

In addi­tion to these changes that go into effect in less than a week, there are other things you should aware of. 

Trans­ac­tion Priv­i­lege Tax License Change:  You are prob­a­bly aware that the Ari­zona “sales tax” increased 1% statewide on June 1st, and you should have already adjusted your soft­ware, point of sales sys­tems and reg­is­ters.  How­ever some­time in Sep­tem­ber the AZ DOR is going to be send­ing out Trans­ac­tion Priv­i­lege Tax renewal forms.  The only peo­ple who won’t have to renew their licenses are those who got their licenses on or after July 1, 2009.  The law increases the fee to obtain, change or renew a license to $40 up from $12 for a period of 1 year and 2 weeks start­ing June 15, 2010;  means the change will be in effect for the state’s entire upcom­ing fis­cal year.  It’s not expected to be a big rev­enue raiser, but the AZ DOR hopes to get peo­ple who have never filed a TPT return or who haven’t filed in a long time off the sales tax rolls.  If you’e had your license a year or longer, you will need to pay for the renewal if you want to keep it.

Non­con­for­mity with Fed­eral 2009 tax forms: This change qui­etly went into effect on April 27, 2010.  The State of Ari­zona decided not to con­form to the Fed­eral Tax code after the first tax dead­line had passed.  If you filed your tax form on or before April 15, 2010 and you had any of the fol­low­ing items of income, deduc­tion or credit on your tax return-you may need to file an amended Ari­zona tax return and pay addi­tional tax.  You do not need to amend your fed­eral tax return, just Arizona’s. 

  • Unem­ploy­ment: you need to add the $2400 the fed­eral gov­ern­ment exempted from gross income back into your Ari­zona income and pay the addi­tional tax.
  • Auto­mo­bile Sales Tax deduc­tion: you need to remove the auto­mo­bile sales tax from your deduc­tions, which will increase your income and you may owe addi­tional tax.
  • Haiti Con­tri­bu­tions made between Jan­u­ary 11 and before March 1, 2010 that were taken as a char­i­ta­ble deduc­tion in 2009.  These con­tri­bu­tions will be eli­gi­ble char­i­ta­ble deduc­tions on your Ari­zona taxes in 2010.  Again this will increase your income and you may owe addi­tional tax.
  • Dis­charge of Indebt­ed­ness (DOI) Income From Busi­ness Indebt­ed­ness Dis­charged by the Reac­qui­si­tion of a Debt Instru­ment–the feds allowed it to be added rat­ably over 5 years, AZ did not. 
  • Orig­i­nal Issue Dis­count (OID) on Reac­qui­si­tion of Debt Instru­ment–the feds allowed the income to be deferred, AZ did not. 
  • Spe­cial Fed­eral Net Oper­at­ing Loss (NOL) Car­ry­back Rules for 2008 and 2009 Losses-the feds allowed a spe­cial longer car­ry­back period of 3, 4, or 5 years, instead of 2, AZ did not. 

 The amended tax form is 140X for indi­vid­ual tax­pay­ers and it can be found on the AZ DOR web­site.  There is more infor­ma­tion about AZ 2009 non­con­for­mity here. These links take you to the Ari­zona Depart­ment of Rev­enue web­site and you will be sub­ject to their pri­vacy poli­cies etc.; Art and Busi­ness Con­sult­ing LLC is not affil­i­cated with the AZ DOR. 

If you live in another state, check with your state’s depart­ment of rev­enue regard­ing con­for­mity issues with respect to your state. 

As always Art and Busi­ness Con­sult­ing is here to help.  If you need help fil­ing an amended Ari­zona tax return, or any other with a small busi­ness and or tax issue, please give us a call.

The usual dis­claimers: Although ABC has made every effort to insure the accu­racy of Taxes, Tips and Tools, mis­in­for­ma­tion, dis­in­for­ma­tion, changes, mis­takes, typos and hack­ers hap­pen, there­fore Art & Busi­ness Con­sult­ing LLC takes no respon­si­bil­ity for any action taken or results based on the infor­ma­tion sup­plied here in. The con­tent of this blog gen­er­ally applies to busi­ness and indi­vid­ual tax­a­tion in the United States of Amer­ica.  Inter­nal Rev­enue Ser­vice Cir­cu­lar 230 Dis­clo­sure:  As pro­vided for in Trea­sury reg­u­la­tions, advice (if any) relat­ing to fed­eral taxes that is con­tained in this com­mu­ni­ca­tion (includ­ing attach­ments) is not intended or writ­ten to be used, and can­not be used for the pur­pose of (1) avoid­ing penal­ties under the Inter­nal Rev­enue Code or (2) pro­mot­ing, mar­ket­ing or rec­om­mend­ing to another party any plan or arrange­ment address herein.  Art & Busi­ness Con­sult­ing LLC cur­rently does not have a cer­ti­fied pub­lic accoun­tant, human resource spe­cial­ist, finan­cial plan advi­sor or an attor­ney on staff; this infor­ma­tion is purely for edu­ca­tional pur­poses and not to be con­strued as legal or finan­cial advice. Art & Busi­ness Con­sult­ing LLC and its employ­ees, mem­bers and asso­ciates are not engage to prac­tice law; you always should dis­cuss legal mat­ters with your attor­ney before talk­ing to any­one else.

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Last days to make a 2009 deductible donation for Haiti

Thursday, February 25th, 2010

A new law bol­sters char­i­ta­ble dona­tions made for recov­ery efforts in Haiti — donors can deduct gifts made before March 1, 2010 on their 2009 tax returns.  Fur­ther­more phone bills can be used as proof of dona­tions made via text message.

As always, small busi­ness ser­vices and tax­a­tion are our busi­ness. If you need help with your busi­ness or indi­vid­ual taxes, Please give Art & Busi­ness Con­sult­ing a call.  We would love to engage you as a client.

The usual dis­claimers: Although ABC has made every effort to insure the accu­racy of Taxes, Tips and Tools, mis­in­for­ma­tion, dis­in­for­ma­tion, changes, mis­takes, typos and hack­ers hap­pen, there­fore Art & Busi­ness Con­sult­ing LLC takes no respon­si­bil­ity for any action taken or results based on the infor­ma­tion sup­plied here in.  Inter­nal Rev­enue Ser­vice Cir­cu­lar 230 Dis­clo­sure:  As pro­vided for in Trea­sury reg­u­la­tions, advice (if any) relat­ing to fed­eral taxes that is con­tained in this com­mu­ni­ca­tion (includ­ing attach­ments) is not intended or writ­ten to be used, and can­not be used for the pur­pose of (1) avoid­ing penal­ties under the Inter­nal Rev­enue Code or (2) pro­mot­ing, mar­ket­ing or rec­om­mend­ing to another party any plan or arrange­ment address herein.  Art & Busi­ness Con­sult­ing LLC cur­rently does not have a cer­ti­fied pub­lic accoun­tant or an attor­ney on staff; this infor­ma­tion is purely for edu­ca­tional pur­poses and not to be con­strued as legal or finan­cial advice.  Art & Busi­ness Con­sult­ing LLC and its employ­ees, mem­bers and asso­ciates are not engage to prac­tice law; you always should dis­cuss legal mat­ters with your attor­ney before talk­ing to any­one else.

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Changes to Arizona’s Tax Credit For The Working Poor in 2010

Tuesday, February 2nd, 2010

Last year the AZ Tax Credit For The Work­ing Poor got bet­ter as the so called base period restric­tion was removed.

This year, the Ari­zona Depart­ment of Rev­enue (AZ DOR) is tasked with mak­ing sure all the char­i­ties on the list for this credit  meet the con­di­tion that 50% or more of every dol­lar donated goes directly toward assist­ing the work­ing poor, so they sent out a ques­tion­naire to every char­ity on the 2009 list.  Sev­eral responded, “Yeah, yeah, we know, we do not qual­ify.” Oth­ers have not responded at all.  The net result is the 2010 list of eli­gi­ble orga­ni­za­tions is much shorter that the one for 2009.

Before you donate to a char­ity expect­ing to receive this credit you may want to check to see if they are still on the list.

Just because the char­ity doesn’t appear on the list doesn’t mean you can’t make a char­i­ta­ble con­tri­bu­tion to them and take a deduc­tion, it merely means you will not be eli­gi­ble for this Tax Credit.

Also just because your favorite char­ity has not yet showed up on the list, doesn’t mean that they won’t; it means they have not com­pleted the ques­tion­naire and returned it to the AZ DOR. Until they do they will not be a char­ity eli­gi­ble for the tax credit in 2010.

In other news, this year the AZ DOR is NOT dis­trib­ut­ing 2009 Income Tax Forms at the local post offices nor  at  local libraries.  They will NOT mail them even if you call to order one.  The only ways to get the income tax forms is from an AZ DOR office or to down­load it from their web­site: http://www.azdor.gov/Forms/Individual.aspx.  If you fol­low the links to the AZ DOR web­site, please be advised that you’re nav­i­gat­ing away from ArtAndBusinessConsulting.com and you will be sub­ject to their policies-we do not know what they are nor do we have con­trol of them.

If you need help with these issues or any other, remem­ber, small busi­ness ser­vices and tax­a­tion are our busi­ness.  Please give Art & Busi­ness Con­sult­ing a call.  We would love to engage you as a client.

The usual dis­claimers: Although ABC has made every effort to insure the accu­racy of Taxes, Tips and Tools, mis­in­for­ma­tion, dis­in­for­ma­tion, changes, mis­takes, typos and hack­ers hap­pen, there­fore Art & Busi­ness Con­sult­ing LLC takes no respon­si­bil­ity for any action taken or results based on the infor­ma­tion sup­plied here in.  Inter­nal Rev­enue Ser­vice Cir­cu­lar 230 Dis­clo­sure:  As pro­vided for in Trea­sury reg­u­la­tions, advice (if any) relat­ing to fed­eral taxes that is con­tained in this com­mu­ni­ca­tion (includ­ing attach­ments) is not intended or writ­ten to be used, and can­not be used for the pur­pose of (1) avoid­ing penal­ties under the Inter­nal Rev­enue Code or (2) pro­mot­ing, mar­ket­ing or rec­om­mend­ing to another party any plan or arrange­ment address herein.  Art & Busi­ness Con­sult­ing LLC cur­rently does not have a cer­ti­fied pub­lic accoun­tant or an attor­ney on staff; this infor­ma­tion is purely for edu­ca­tional pur­poses and not to be con­strued as legal or finan­cial advice.  Art & Busi­ness Con­sult­ing LLC and its employ­ees, mem­bers and asso­ciates are not engage to prac­tice law; you always should dis­cuss legal mat­ters with your attor­ney before talk­ing to any­one else.

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Posted in General Individual, Individual Taxes | 1 Comment »

Worker, Homeownership, and Business Assistance Act of 2009

Saturday, November 14th, 2009

After much debate and con­gres­sional gnash­ing of teeth, the long awaited unem­ploy­ment exten­sion act, enti­tled, the Worker, Home­own­er­ship, and Busi­ness Assis­tance Act of 2009, has been passed and signed into law as of Novem­ber 6, 2009. It is hap­pen­ing none too soon for some unem­ployed work­ers – DOL sta­tis­tics list more than a third of unem­ployed work­ers have been unem­ployed for 27 weeks or more. This leg­is­la­tion con­tains ben­e­fits for home­buy­ers, busi­nesses expe­ri­enc­ing losses too.   This blog is not to dis­cuss the right­ness or wrong­ness of the leg­is­la­tion; it merely to express what has been signed into law and what it is sup­posed to do.

Unem­ploy­ment Ben­e­fits Pro­vi­sions: These ben­e­fits are sup­posed to help workers.

  • pro­vides an addi­tional 14 weeks of extended unem­ploy­ment ben­e­fits (EB) in all States
  • an six addi­tional weeks of EB for work­ers in states with unem­ploy­ment lev­els over 8.5 per­cent. High unem­ploy­ment states cur­rently include the Dis­trict of Colum­bia, Puerto Rico, Alabama, Ari­zona, Cal­i­for­nia, Dis­trict of Colum­bia, Florida, Geor­gia, Idaho, Illi­nois, Indi­ana, Ken­tucky, Maine, Mass­a­chu­setts, Michi­gan, Mis­sis­sippi, Mis­souri, Nevada, New Jer­sey, North Car­olina, New York, Ohio, Ore­gon, Penn­syl­va­nia, Puerto Rico, Rhode Island, South Car­olina, Ten­nessee, Wash­ing­ton, West Vir­ginia and Wis­con­sin. More states could soon qual­ify because of ris­ing unem­ploy­ment rates.
  • These ben­e­fits are in addi­tion to the Emer­gency Unem­ploy­ment Com­pen­sa­tion (EUC) which may pro­vide up to 33 weeks of addi­tional ben­e­fits beyond reg­u­lar unem­ploy­ment compensation.
  • Check with your state’s unem­ploy­ment agency for eli­gi­bil­ity details and infor­ma­tion on how to apply for ben­e­fits as unem­ploy­ment varies from state to state.

Note: In my research there is a ques­tion as to whether work­ers who run out of reg­u­lar and EUC ben­e­fits after Decem­ber 26, 2009, will eli­gi­ble for this 14–20 weeks of extended ben­e­fits.  I have been to the AZ unem­ploy­ment ben­e­fit exten­sions web­site and they are research­ing how this leg­is­la­tion affect Arisona work­ers.  AZ DES states that they will pub­lish updates on the web­site; AZ DES requests that you do not call them as nobody you might talk to will have any more infor­ma­tion than what is con­tained on their website.

Home­buyer Credit: These ben­e­fits are sup­posed to kick start the hous­ing mar­ket again.

  • extends the $8,000 First-Time Home­buyer Tax Credit through April 30, 2010 and
  • pro­vides a $6,500 credit to cer­tain other home­buy­ers, peo­ple who have lived in their cur­rent home for at least 5 years and want to step up to a new home, through April 30, 2010
  • for pur­chases after the Act’s enact­ment date, the credit can­not be claimed for buy­ing a res­i­dence with a pur­chase price in excess of $800,000
  • in addi­tion, the Act includes new anti-abuse pro­vi­sions: To curb fraud, tax­pay­ers must now attach a copy of the set­tle­ment agree­ment to the tax return.  The credit must be repaid if, within three years of pur­chase, the home ceases to be the taxpayer’s prin­ci­pal residence.
  • the credit phases out for indi­vid­ual tax­pay­ers with mod­i­fied adjusted gross income between $125,000 and $145,000 ($225,000 and $245,000 for joint fil­ers) for the year of purchase.
  • the bill will also elim­i­nate the first-time home­buy­ers recap­ture require­ment for mil­i­tary per­son­nel, includ­ing mem­bers of the For­eign Ser­vice and intel­li­gence com­mu­nity, who are forced to sell as a result of an offi­cial extended duty of ser­vice and will allow mil­i­tary per­son­nel serv­ing out­side the United States at least 90 days in 2009 or 2010, one addi­tional year to qual­ify for the credit.

NOL carry-back for 5 years for busi­nesses: These ben­e­fits are sup­posed to get com­pa­nies hir­ing work­ers again.

  • increases from two to five pre­ced­ing years the period for which busi­nesses can off­set net oper­a­tion losses in 2008 OR 2009 against income.
  • the only com­pa­nies not eli­gi­ble for the 5-year NOL carry-back are Fan­nie Mae, Fred­die Mac and com­pa­nies that took money under the Trou­bled Asset Relief Pro­gram (TARP)
  • the tax­payer can choose to carry-back the losses in either 2008 OR 2009 for this treat­ment, but once the year is elected it can­not be changed.
  • small busi­nesses that qual­i­fied for the 5-year carry-back under Amer­i­can Recov­ery and Rein­vest­ment Act of 2009 (ARRA), may be eli­gi­ble for 5 year carry back in both 2008 and 2009.
  • under this act, the 5th year carry-back can­not exceed 50% of the tax­able income for that year.
  • the Act sus­pends the 90% lim­i­ta­tion on the use of net oper­at­ing losses for AMT purposes.

It also helps mil­i­tary fam­i­lies by clar­i­fy­ing that mil­i­tary base realign­ment and clo­sure pay­ments – added as part of the recov­ery act – are tax exempt.

The Act gives broad author­ity to the Trea­sury to issue anti-abuse reg­u­la­tions includ­ing anti-churning rules (includ­ing sale/leaseback), anti-stuffing rules, and rules sim­i­lar to the wash sale rules.

How are they pay­ing for it?

The leg­is­la­tion pays for these new steps, prin­ci­pally by post­pon­ing tax pro­vi­sions ben­e­fit­ing U.S.  multi­na­tional cor­po­ra­tions.  The leg­is­la­tion delays for seven years (through 2017) a  tax break enacted in 2004 that would let U.S. multi­na­tional com­pa­nies that have shipped jobs over­seas reduce their U.S. taxes by deduct­ing more of their world­wide inter­est income against their U.S. income.

The Act extends the Fed­eral Unem­ploy­ment Tax Act sur­tax through June 30, 2011: FUTA was set to drop to 6%, but this extends the 6.2% level-by the way this sur­tax was enacted about 30 years ago as a tem­po­rary mea­sure that keeps get­ting extended.

The Act increased the penalty from $89 to $195 per partner/shareholder for fail­ure to file an S-corporation or part­ner­ship tax return.

The Act increases esti­mated tax pay­ments for large cor­po­ra­tions in 2014

And that is every­thing I have been able to find out about this new leg­is­la­tion, I hope you find it infor­ma­tive.  As always, small busi­ness ser­vices and tax­a­tion are our busi­ness. If you need help Please give Art & Busi­ness Con­sult­ing a call. We would love to engage you as a client.

The usual dis­claimers: Although ABC has made every effort to insure the accu­racy of Taxes, Tips and Tools, mis­in­for­ma­tion, dis­in­for­ma­tion, changes, mis­takes, typos and hack­ers hap­pen, there­fore Art & Busi­ness Con­sult­ing LLC takes no respon­si­bil­ity for any action taken or results based on the infor­ma­tion sup­plied here in.   Inter­nal Rev­enue Ser­vice Cir­cu­lar 230 Dis­clo­sure:  As pro­vided for in Trea­sury reg­u­la­tions, advice (if any) relat­ing to fed­eral taxes that is con­tained in this com­mu­ni­ca­tion (includ­ing attach­ments) is not intended or writ­ten to be used, and can­not be used for the pur­pose of (1) avoid­ing penal­ties under the Inter­nal Rev­enue Code or (2) pro­mot­ing, mar­ket­ing or rec­om­mend­ing to another party any plan or arrange­ment address herein.  Art & Busi­ness Con­sult­ing LLC cur­rently does not have a cer­ti­fied pub­lic accoun­tant or an attor­ney on staff; this infor­ma­tion is purely for edu­ca­tional pur­poses and not to be con­strued as legal or finan­cial advice. Art & Busi­ness Con­sult­ing LLC and its employ­ees, mem­bers and asso­ciates are not engage to prac­tice law; you always should dis­cuss legal mat­ters with your attor­ney before talk­ing to any­one else.

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Posted in General Business, General Individual | 1 Comment »