1099-B Forms Delayed This Tax Season
Written by Kristine McKinley · January 14, 2009
The IRS has announced that brokers may furnish certain composite annual tax reporting statements by Feb. 17, 2009, without penalty.
The notice provides that the new February due date established under a recent law change to provide Form 1099-B information to customers also applies to other tax information customarily reported to customers with Form 1099-B statements, such as interest and dividends. This means that customers can expect to receive Forms 1099-INT and 1099-DIV late as well.
If you normally receive Forms 1099-INT, 1099-DIV and 1099-B for investment income and transactions, be aware that these forms will arrive later than usual this year. Some clients have reported that they have received letters from financial institutions saying not to expect these forms until the end of February (although the official due date is February 17).
As a tax preparer, I’m not particularly happy about this change, but on the bright side, I’m hoping the extended deadline will cut down on the number of corrected 1099s issued this tax season.
Related PostsSocial Security Benefits Increase 5.8% for 2009
Written by Kristine McKinley · January 12, 2009
Finally some good news for retirees… Social Security benefits are being increased 5.8% for 2009. This is the largest increase in more than 25 years!
This increase will boost the average monthly Social Security retirement check from $1,090 to $1,153.
Even more good news… for the first time since 2000, Medicare premiums will not go up in 2009. Currently the Medicare Part B premium is $96.40 per month.
This is good news for Seniors who have seen their portfolios plunge over the last 15 months. If possible, you should use this increase to reduce the amount you are withdrawing from your portfolio, to give it more time to recover recent losses.
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Seniors Get a Tax Break in 2009 – Congress Suspends RMD
Written by Kristine McKinley · December 12, 2008
I know many people were hoping this would pass for 2008 rather than 2009, but I guess late is better than not at all.
Congress approved legislation this week that will provide some relief to Americans over 70 1/2 who have suffered significant losses in their IRA accounts. The bill will temporarily suspend the excise tax that is levied when seniors fail to the the required minimum distribution (RMD) from their retirement accounts.
This penalty is waived for 2009, which means that seniors will not be required to take withdrawals from their tax deferred retirement accounts during 2009, which will hopefully give these accounts time to recover before the 2010 required distribution. Unfortunately, this law does not apply to 2008 when it would have made the most difference to investors who have lost significant amounts in their accounts.
Continue Reading Seniors Get a Tax Break in 2009 – Congress Suspends RMD
Related PostsHome Energy Credits Back For 2009 Only
Written by Kristine McKinley · December 2, 2008
A new tax law in 2006 allowed homeowners to claim credits for purchases that make their homes more efficient. This law was originally only for purchases or improvements made in 2006 and 2007, but has been extended by the Emergency Economic Stabilization Act of 2008 to include 2009 (not sure why but 2008 was skipped).
Here is a refresher on the original law (edited for 2009):
During 2009, individuals can make energy-conscious purchases that will provide tax benefits when filling out their tax returns. Manufacturers offering energy efficient items such as insulation or storm windows can assure their customers that their energy efficient items will qualify for the tax credit if certain energy efficiency requirements are met.
This tax law change provides a tax credit to improve the energy efficiency of existing homes. The law provides a 10 percent credit for buying qualified energy efficiency improvements. To qualify, a component must meet or exceed the criteria established by the 2000 International Energy Conservation Code (including supplements) and must be installed in the taxpayer’s main home in the United States.
The following items are eligible:
* Insulation systems that reduce heat loss/gain
* Exterior windows (including skylights)
* Exterior doors
* Metal roofs (meeting applicable Energy Star requirements).
Continue Reading Home Energy Credits Back For 2009 Only
Related PostsWatch Out for Capital Gain Distributions in 2008
Written by Kristine McKinley · December 1, 2008
Despite widespread stock market losses in 2008, several mutual fund companies have announced that they will make capital gain distributions to shareholders in mid-December.
This is a double whammy to investors because shareholders who hold mutual funds in taxable accounts must pay taxes on those capital gain distributions even if those capital gains were reinvested in the fund. This may seem unfair when 1) you didn’t receive the money, and 2) your fund suffered a large loss for the year.
So why do mutual fund companies distribute capital gains to shareholders when the fund itself has incurred a loss for the year? There are three reasons that funds are making payouts, even though they’re up to their ears in losses:
First, emerging markets and energy funds had big gains when the year began and realized some gains along the way. Then they suffered redemptions, which means that those gains have to be spread among fewer shareholders (i.e., the shareholders who did not bail have to pay the price for those who are trying to time the market).
Continue Reading Watch Out for Capital Gain Distributions in 2008
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