SKR+Co Alert: 1099 reporting, charitable IRA distributions, late tax season opening and more!

January 24, 2013

Form 1099-related questions on your business tax return

The deadline (January 31) is quickly approaching for businesses to issue Form(s) 1099 when applicable. And this year, the IRS may be looking more closely at how the two questions added to the business tax return are answered. This article explains when Form 1099 must be filed, the due dates and penalties involved, as well as how to file.

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Newly revived "charitable IRA rollovers" – Time is running out

The American Taxpayer Relief Act of 2012 (ATRA) revives for 2012 and 2013 the opportunity to make tax-free IRA distributions (up to $100,000 per year) for charitable purposes. If you’re age 70½ or older, you can make a direct contribution from your IRA to a qualified charitable organization without owing any income tax on the distribution. This “charitable IRA rollover” can be used to satisfy required minimum distributions.

To help taxpayers take advantage of the 2012 revival, ATRA allows a charitable rollover made in January 2013 to be treated for tax purposes as if it had been made Dec. 31, 2012. And if you took an IRA distribution in December 2012 and contribute it to charity in January 2013, the “direct contribution” requirement is waived; you can contribute the distribution to a qualified charity in January 2013 and treat it as a 2012 direct contribution, provided the other requirements are met.

New, simplified option for claiming home office deduction 

Owners of home-based businesses and home-based workers will have a simpler option to figure the deduction for business use of the home, beginning with the 2013 tax return. The new optional method allows home-based businesses to deduct up to $1,500, based on $5 per square foot and up to 300 square feet. For more information, please read the IRS announcement from January 15, 2013.

Read IRS Announcement HERE.

Late tax season opening for many, but don't delay!

Due to the late passage of the American Tax Relief Act (ATRA), the Internal Revenue Service announced that it will open tax season for individual filers on January 30th. In addition, many forms are still in the process of being revised and will not be available until a later date. And, you may once again have a delay in receiving your 1099s from your brokerage firm.

That being said, as our clients, we strongly suggest that you not delay in gathering your tax information and sending it in to us to begin preparing the return. Even if you have not yet received everything, there is much that we can do today to get your tax return ready for filing which will make the process much quicker once the forms are ready. 

If you have questions about how the filing delays may impact you, please contact us. 

Please let us know if we can answer any questions or help in any way. You can contact us at (719) 630-1186 or through ourSecure Email.