Memo Re: HIRE Act You may be eligible for a credit for part of your FICA payroll tax liability because of the recently passed HIRE act. This credit applies to the matching FICA you pay on the wages of a qualified employee who: Began employment with you after February 3, 2010, and Has not been employed by anyone for more than 40 hours during the 60 day period ending on the date the employee begins employment with you.  The employee must sign form W-11 certifying this before the credit can be claimed, and Is not employed by you to replace another employee unless the other employee separated from employment voluntarily or for cause (including downsizing), and Is not related to you or to anyone who owns more than 50% of your outstanding stock (in the case of a corporation).  An employee is related to you if he or she is your child, descendent of your child, your sibling or stepsibling, your parent or an ancestor of your parent, your stepparent, niece or nephew, aunt or uncle, in-law, or can be claimed as your dependent. We are reviewing clients’ payroll records in order to determine which employees may be qualified and we ask that you check your records, too, so that we may claim this credit for you, if it applies, beginning with the second quarter 941 report.  Please remember that we must have a signed form W-11 in hand before we can claim this credit.  We have these forms available in our office and we can fax or email them to you as needed. If you have any questions, please call!   Health Care Act There are many new provisions in the Health Care Act that will affect taxpayers.  You may be eligible for a credit if your furnish your employees with health insurance and pay at least 50% of the cost.   Call us for details!!     The Housing Assistance Tax Act of 2008, passed by Congress and recently signed by the President provides a number of tax law changes, some of which include: ·         First Time Homebuyer Tax Credit The “first-time home buyer credit” is a temporary refundable, repayable tax credit equal to 10% of the purchase price of a home, up to $7,500 for singles and married couples filing jointly. (Singles who buy a house together get only $3,750 each, as do married couples filing their tax returns separately.) Also, you must close on your new house between April 9, 2008 and July 1, 2009.    But the way the credit works, it’s actually more like an interest-free loan. Two years after you claim this credit, you have to start paying it back. The payback comes over 15 years in 15 equal installments–meaning you owe an extra $500 on your tax return each year. Sell your house, and you have to pay the rest back that year from your profits. (No profits, no pay back. Also, if you die, your heirs are off the hook.) The allowed credit starts being reduced once a single has $75,000 of modified adjusted gross income, or once a couple has $150,000 of income. The credit goes away entirely at $95,000 for singles and $170,000 for couples. For 2009, the homebuyer credit has been expanded.  Please call our office for details.   Making Work Pay credit and American Opportunity credit(this applies to college education expenses.)  These are refundable credits.  If you did not receive these, please contact our office.     Mileage Rate for 2010- Beginning on Jan. 1, 2010, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be: 50 cents per mile for business miles driven 16.5 cents per mile driven for medical or moving purposes 14 cents per mile driven in service of charitable organizations   Energy credits. As part of the stimulus package, there are certain energy credits available on your 2009 return.  Please give our office a call for information on these credits.      Minimum Wage Hike Minimum wage increased to $7.25, effective July 24, 2009.   Qualified Bicycle Commuting Expenses Beginning with years after 2008, employees may exclude reimbursements paid by employers for qualified bicycle commuting expenses. The maximum exclusion is $20 times the number of months the employee uses a bicycle for commuting to work. Allowable expenses include the purchase, maintenance, repair and storage expenses related to commuting. IRC 132(f) The bicycle commuting expense exclusion cannot be claimed for any period in which the exclusion for public transit passes or qualified parking is claimed.   Dependents Dependents must file a tax return if their gross earned income is at least $5700 or unearned income is greater than $950. ***Be sure to let us know if your dependent filed a tax return and claimed himself.  The largest percentage of returns are rejected when we attempt to efile due to dependents filing and claiming themselves and then the parents claim them as well.  ***   Are payroll and payroll tax returns tying you in knots or taking way too much of your time? We offer flexible services for your payroll needs. Weekly, bi-monthly, monthly  payroll computation Computation of payroll deposit amounts EFTPS enrollment and weekly/monthly reporting Preparation of quarterly payroll tax returns (whether we prepare your payroll or you prepare it yourself) Preparation of W2 and 1099 forms We can do as little or as much as you need for us to do.   Don't forget to visit the financial literacy website for tons of useful information regarding planning for different stages of life.  There are links to many useful web sites to assist you in these difficult financial  times. www.360financialliteracy.org  Quickbooks software  We have a team member who has obtained her  Quickbooks Certification.  We have several people with years of experience working with Quickbooks.  Please call us if you would like more information.