Tag Archives: tax code changes

Electric Vehicle Tax Credits and Roth Conversions for Retirement Plans

11 February
Plug-In Electric

Plug-in Electric 2- and 3-Wheeled Vehicles [IRC §30D(g)] Under prior law, the Electric Vehicle Credit for low-speed vehicles, motorcycles, and 3-wheeled vehicles under IRC section 30 expired for vehicles acquired after 2011. Likewise, the Electric Vehicle Conversion Kit Credit under IRC section 30B(i) expired for conversions made after December 31, 2011. New Law: The new law […]

Accumulated Earnings Tax, S-Corp Built-In Gains Tax, and Work Opportunity Credits

06 February
Accumulated Earnings Tax

Accumulated Earnings Tax (IRC §531) When a C corporation distributes its earnings to shareholders, the shareholders are subject to income tax on the dividends received. Since the corporation has already paid income tax on those earnings, the tax on dividends is considered to be double taxation of the same income (once at the corporation level and […]

Special Depreciation Allowance [IRC §168(k)]

04 February
Special Depreciation Allowance

The special depreciation allowance was first introduced to assist taxpayers in recovering from the September 11, 2001, terrorist attacks. In its original state, the allowance was an additional depreciation deduction of 30% of the qualified property’s depreciable basis and was generally claimed in the year the property was placed in service. The adjusted basis of […]

Charitable Contributions of IRA Distributions [IRC §408(d)(8)]

30 January
Retirement Fund

Distributions from traditional IRAs are generally taxable. Contributions to charitable organizations are generally deductible as itemized deductions. If a taxpayer receives a distribution from an IRA, and then contributes the money to a qualified charity, the two transactions generally cancel each other out (distribution increases taxable income while the contribution decreases taxable income). However, since […]

Estate Tax and Gift Tax Rates Changes (IRC §2001 and §2010)

28 January
Gift Tax Rate

The estate and gift tax rate schedule for gifts made or decedents dying in 2010 through 2012 are as follows: Note: Executors of 2010 estates could opt out of estate tax by electing a modified carryover basis rule   The estate and gift tax rate schedule for gifts made or decedents dying in 2001 are as […]

New Changes to the Alternative Minimum Tax (IRC §53 and §55)

23 January
Alternative Minimum Tax

Some of the more common tax situations that cause a taxpayer to pay more tax under AMT include: AMT Exemption Amounts The exemption amounts are designed to prevent low and middle income taxpayers from being subject to AMT. A taxpayer first has to have income above the exemption amounts before any of it is subject […]

Long-Term Capital Gain and Qualified Dividend Tax Rates [IRC §1(h)]

21 January

Long-term capital gains are gains on capital assets held for more than one year. Qualified dividends are ordinary dividends from domestic C corporations that meet certain holding period rules and other requirements that qualify for long-term capital gain tax rates. Under The Jobs and Growth Tax Relief Reconciliation Act of 2003, the maximum tax rates […]

New Tax Rate Schedules and Marriage Penalty Relief Changes

14 January

Tax Rate Schedules (IRC §1) The 2001 tax act reduced tax rates gradually over several years. The tax rates for 2001 were the 15%, 27.5%, 30.5%, 35.5%, and 39.1% tax brackets. A 10% tax bracket was reflected in either an advanced rebate check issued directly to taxpayers, or a tax credit claimed on Form 1040. A special rule […]