Carol Keane & Associates Certified Public Accountants

Carol Keane & Associates Certified Public Accountants Carol Keane & Associates provides exceptional tax and accounting services by helping clients grow their businesses and minimize their taxes.

02/07/2019

Get Ready! Here Comes the New 1040...
We are all in for a wild ride as we navigate the biggest tax overhaul in 30 years on a new Form 1040 with six new schedules. Now that the new Form 1040 is finalized, here are three main takeaways for this tax season:
• The main form is shorter, but additional schedules will likely be required. The new Form 1040 may appear to be simpler, but the filing process is more complex. In fact, the instructions to help complete the new form checks in at 117 pages — 10 more pages than last year. Most of the same information from the previous year is still required, except now it's spread over multiple schedules. Industry experts are planning for a 20 percent increase in tax prep time for this filing season.
• Forms 1040A and 1040EZ are no longer available. If you previously filed with one of these forms, you will now be using the new Form 1040. In addition to learning the new form, there's a good chance that you'll need to add at least one of the new schedules to complete your tax return.
• Filings could be delayed. Because of the vast changes in tax laws this year, additional IRS taxpayer guidance is expected throughout the filing season.

01/31/2019

Claiming an education credit? Don't forget the timing rules
TEASER: If you plan on claiming an education credit, make sure you follow the timing rules for expense payments.
COMPLETE ARTICLE: The American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC) include timing rules for expense payments that you need to know if you plan on claiming either on your 2018 tax return.
Know what year to pay school expenses
You can claim the AOTC or LLC in the taxable year in with which the qualified school expenses are paid.
For example, if you paid tuition expenses in 2018 with loan money, you can claim the credit on your 2018 federal income tax return. Keep in mind that this rule specifically states the education credit is claimed in the year the loan money is disbursed, not when the loan is repaid.
If the loan money is sent directly to your school, the expenses are treated as paid on the date the school credits it to your account. If you're not sure of the date the loan money was credited to your account, the rules say you treat the expenses as paid on the last day for payment prescribed by the school.
Tax tip: Ask the school to provide a student financial account statement to help you claim the credit in the correct year.

01/28/2019

Your 2019 Social Security benefits recap

TEASER: Do you collect Social Security? Find out what's changed for 2019.

COMPLETE ARTICLE: The Social Security Administration (SSA) made a 2.8 percent increase to monthly Social Security and Supplemental Security Income (SSI) benefits for 2019. Take a look at some of the most significant changes as you create and update your financial plan for 2019:

2019 Social Security benefit highlights
• Up to $132,900 in wages will be subject to Social Security taxes (up $4,500 from 2018). This amounts to $8,239.80 in maximum annual employee Social Security payments.
• Retirees under full retirement age can earn up to $17,640 before Social Security benefits are reduced, and up to $46,920 the year they reach full retirement age.
• The estimated average monthly benefit will be $1,461 per month in 2019 for all retired workers receiving Social Security retirement benefits. This is an average increase of $39 per month.
• The Social Security and Medicare tax rates do not change from 2018 to 2019 (7.65 percent for employees and 15.30 percent for self-employed).
Supplemental Security Income
SSI is a benefit for people who have disabilities, who are blind or who are 65 and older, and have limited income and resources. The benefit is $2,000 for single people and $3,000 married people. Children who are blind or have disabilities may also get SSI.
A full-time student who is blind or has a disability can still receive SSI benefits as long as earned income does not exceed the monthly and annual student exclusion amounts ($1,870/monthly and $7,550/yearly).

01/21/2019

The adjusted gross income (AGI) floor to deduct medical expenses as an itemized deduction is increasing from 7.5 percent to 10 percent of AGI in 2019. This means that depending on your situation, it will either be harder to deduct medical expenses or the deduction you're used to will be less. If possible, bunching multiple medical expenses into one year may allow you to itemize. Call to discuss how these changes affect your situation.

01/14/2019

The penalty imposed on individuals without qualified health insurance will be gone starting in 2019. The penalty has been as high as $2,085 per family in previous years, depending on your household.

Keep in mind that individual states may impose their own individual mandate penalties. Prepare yourself for possible rising insurance costs.

01/07/2019

Interest rates for the first quarter in 2019 are up from last quarter. Those rates include: 6 percent for overpayments (5 percent for corporations), 3.5 percent for the portion of a corporate overpayment over $10,000, 6 percent for underpayments and 8 percent for large corporation underpayments.

12/31/2018

Create a plan to pay for next year's tax obligation throughout the year to avoid needing funds to pay your tax bill. This may cause some hardship, but saving a little bit more each week through payroll withholdings is usually more manageable for most of us versus a big tax bite in April.

12/28/2018

Certain deductions require substantiation and/or logs to qualify your expense. Some common areas that require this are business and volunteer mileage, non-cash charitable contributions and some business expenses. These logs should be maintained throughout the year, but now is a good time to make sure they are complete and ready to go when you need them.

08/06/2018

Starting this year, employers can take advantage of a new credit for paid family and medical leave created by the Tax Cuts and Jobs Act. Employers may claim the credit based on wages paid to employees while they are on leave for the birth of a child, a serious health condition, and other family and medical events.
The credit is a percentage (ranging between 12.5 percent to 25 percent) of the amount of wages paid to an employee while on family and medical leave for up to 12 weeks.
The credit is set to expire after the 2019 tax year, however, so keep this in mind for long-term planning.

09/05/2017

Is there a real IRS agent at my doorstep?

If an IRS agent makes an in-person visit to your home or business and it feels a little off, ask for credentials.

All real IRS agents should carry two forms of identification showing that they're legit – a personal identity verification card and a pocket commission card. And regardless of how an agent is contacting you, you can always ask for his/her name, badge number and phone number and call the IRS at 1-800-366-4484 to confirm the agent is a true employee.

07/14/2017

Make some time for tax and financial planning
For most of us, summertime is a bit more relaxed, giving us time to do the tasks we tend to put off. Consider making time to take care of tax and financial tasks. Examples include planning for college or retirement, getting your will written, or building a simple budget. Call if you need help!

05/24/2017

Reminder: June 15 tax filing date for U.S. citizens abroad

U.S. citizens and resident aliens living overseas or serving in the military outside the U.S. receive an automatic two-month extension of the regular tax filing deadline. If this extension applies to your living situation, you have until June 15, 2017 to file your 2016 tax return. To use this automatic two-month extension, you must attach a statement to your return explaining that you live overseas or you are serving in

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