Archive for January 2012

2011 Health Insurance MUST be on W2 for >2% Sub S shareholder

HERE IS HOW TO REPORT IT 

Health Insurance for the entire family goes on Shareholder’s W2

Box 1 & Box 14 (Does not affect FICA).

W3 Box 1 only

Form 941 Box 2 only (Does not affect FICA).

Form 940 Included in Total Payments Line 3 & Box 4  - excluded from FUTA tax

UCT-6 (Florida’s Unemployment Tax) Not shown

Health Insurance for employees does NOT appear any payroll reports (YET!).

2012 Mileage Rates

The 2012 federal mileage rates for the use of a car (also vans,

pickups or panel trucks) will be:

• $0.555 per mile driven for business purposes

• $0.23 per mile driven for medical or moving purposes

• $0.14 per mile driven in service of charitable organizations

Vacation Homes - sometimes you don’t declare the rent!

Vacation homes are taxed under one of three sets of rules depending on how long the homeowner rents the property.

If you rent your vacation home for fewer than 15 days during the year, no rental income is includible in gross income.

If you rent the property for 15 or more days during the tax year and it is used by you for the greater of (a) more than 14 days or (b) more than 10% of the number of days during the year for which the home is rented, the rental deductions are limited. Under this limitation, the amount of the rental activity deductions may not exceed the amount by which the gross income derived from such activity exceeds the deductions otherwise allowable for the property, such as interest and taxes.

How Often Does Tax Law Change….

There were approximately 4,430 changes to the tax code from 2001 through 2010, an average of more than one a day, including an estimated 579 changes in 2010 alone. 

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