Hall & Company CPAs Tax Review: Individuals With IRAs or Qualified Retirement Plans Have Until November 30, 2009 to Roll Over

For 2009 only, retirees and others who have taken a required minimum distribution (RMD) from an individual retirement account (IRA) or qualified retirement plan may roll over or return the funds to their account without facing tax liability, but they only have until November 30, 2009 to do so.

Irvine, CA (PRWEB) November 25, 2009 -- Hall & Company CPAS are advising for 2009 only, retirees and others who have taken a required minimum distribution (RMD) from an individual retirement account (IRA) or qualified retirement plan may roll over or return the funds to their account without facing tax liability, but they only have until November 30, 2009 to do so.

Those with individual retirement accounts (IRAs) or qualified retirement plans are generally required to begin taking distributions from those accounts by December 31st of the year they attain age 70½ or by April 1st of the following year. With the 2008 Worker Act, Congress recognized that many retirees would be forced to take their annual required minimum distribution (RMD) during depressed market conditions. In light of the economic climate at the end of 2008, Congress considered that taxpayers with required minimum distribution (RMD) would have to sell assets within their retirement accounts that could have dropped significantly in value in order to make the distributions.

The 2008 Worker Act provides a one year suspension of the required minimum distribution (RMD) (http://hallcpas.com/contact.html) rules. Therefore, no minimum distribution is required for calendar year 2009 from retirement accounts for those individuals subject to required minimum distribution (RMD). This required minimum distribution reprieve applies to individual retirement accounts [excluding Roth IRAs, 401(k) plans, Section 457(b) plans maintained by a state, or any agency or instrumentality of a state. This is valid for those who took a 2009 payout, whether intentionally, inadvertently, or through automatic distribution.

The normal distribution requirement is measured by the value of the retirement accounts and the individual's life expectancy. Therefore, if an individual attained age 70½ in 2008, he or she was required to begin taking distributions from retirement accounts by December 31, 2008, or if chosen could elect to defer until April 1, 2009 in the first year. There is a downside to this roll over election, because if taken, the individual will need to withdraw two years worth of distributions within one year.

If you are within this age group and would benefit from restructuring these payouts, this grace period could be helpful. You will be required to make a distribution for calendar year 2010 by December 31, 2010. The main reason that a person may want to put the money back into the IRA account or roll it into another account is because they will wind up with less taxable income for 2009, and therefore less income tax to pay. This only applies to one distribution made during calendar year 2009. Another advantage for this group is they will have a larger amount of funds growing tax free in their retirement accounts.

For information about these and other tax laws, interested parties should contact Hall & Company CPAs, Certified Public Accountants, Inc. at 949-910-HALL (4255), or go to wwwhallcpas.com.

Hall & Company CPAs, Inc.

Based in Irvine, California, Hall & Company CPAs, Inc. is an accounting firm that advises its clients on matters ranging from the traditional accounting, financial statements and tax compliance services to consulting advisory services. Hall & Company focuses on building business value in a wide array of industries.

About Bradford Hall, CPA

As the managing director of the Hall & Company, Bradford Hall is actively involved in all aspects of taxation and business planning. He has more than 32 years of experience in public accounting. Hall's core strengths are in the areas of strategic tax planning for high-net-worth individuals, including corporate owners and executives, closely held corporations, partnerships, LLCs and trusts. He has significant experience negotiating corporate sales/merger, acquisitions and divisional spin-offs. In addition, Hall spends a great deal of time consulting in the area of business management, business succession planning, estate planning and preparation of comprehensive personal financial plans. He represents clients before the IRS, FTB and other taxing authorities.

25 Tax Breaks to Consider for 2009

According to a bulletin issued by the Federation of American Consumers and Travelers (FACT), there are a number of 2009 tax breaks that won't be around next year unless Congress acts to extend them. For individuals, these include...

Washington, DC (PRWEB) October 16, 2009 -- According to a bulletin issued by the Federation of American Consumers and Travelers (FACT), there are a number of 2009 tax breaks that won't be around next year unless Congress acts to extend them.

For individuals, 2009 tax breaks include:

• The option to deduct state and local sales and use taxes instead of state income taxes;

• The standard or itemized deduction for state sales tax and excise tax on the purchase of motor vehicles;

• The above-the-line deduction for qualified higher education expenses; tax-free distributions by those age 70 1/2 or older from IRAs for charitable purposes; and

• The $8,000 first-time home buyer credit (expires for purchases after Nov. 30, 2009).

• Finally, without Congressional extension, the alternative minimum tax (AMT) exemption amounts for individuals are scheduled to drop drastically next year, and most nonrefundable personal credits won't be available to offset the AMT.

On the other hand ...

In 2010, there no longer will be an income based reduction of most itemized deductions, nor will there be a phaseout of personal exemptions. Additionally, traditional IRA to Roth IRA conversions will be allowed regardless of a taxpayer's income.

For businesses, 2009 tax breaks that might be available only through the end of this year include:

• 50% bonus first year depreciation for most new machinery, equipment and software;

• A high ($250,000) expensing limitation;

• The research tax credit;

• The five-year write-off for most farm equipment; and

• The 15-year write-off for qualified leasehold improvements, qualified restaurant buildings and improvements and qualified retail improvements.

High-income-earners have other factors to keep in mind when mapping out year-end plans. Many observers expect top tax rates on ordinary income to increase after 2010, making long-term deferral of income less appealing. Long-term capital gains rates could go up as well, so it may pay for some to take large profits this year instead of a few years down the road.

FACT has compiled, from a variety of reliable sources, a checklist of actions based on current tax rules that may help individuals and businesses save tax dollars if they act before year-end. To review this list, visit usafact.org and click on NEWS BULLETINS, then 2009 Tax Breaks (http://usafact.org/NEWSBULLETINS.ASPX).

Vicki Rolens, Managing Director of FACT, says, "To the best of our knowledge, the tax information disseminated by our association is accurate, but no one should attempt to act upon this information without the input and agreement of his or her CPA and/or trusted financial advisor."

This news release has been issued by the Federation of American Consumers and Travelers (FACT). FACT is a not-forprofit consumer organization, formed under the not-for-profit corporation laws of the District of Columbia in 1984. It currently serves more than 1 million consumers nationwide. Additional information on FACT may be found in the Encyclopedia of Associations, and by visiting the association's Web site (www.usafact.org). Informative, unbiased news bulletins are regularly disseminated by FACT to help its members remain current on matters which might seriously impact their lives. In addition to publishing consumer-related reports, the association provides more than 30 benefits for its members, ranging from medical insurance (http://usafact.org/medicalinsurance.html) and dental discounts (http://usafact.org/discountdentalcareplan.html) to prescription drug savings (http://usafact.org/rxdiscounts.html) and scholarships (http://usafact.org/financialaid.html).

FACT's administrative office is located at 318 Hillsboro Avenue, Edwardsville, IL 62025.

JK Harris Reminds Taxpayers of Changes for Upcoming Tax Season

Tax season is approaching and JK Harris and Company wants to make sure taxpayers are aware of changes that may affect them.

North Charleston, S.C. (PRWEB) November 23, 2008 -- As the year draws to a close, it is a good time to be thinking about tax planning. According to Peter Hukki, Enrolled Agent with JK Harris and Company, the nation's largest tax representation firm, there are new credits, as well as extensions of previous credits taxpayers need to consider.

"This year, there are several changes to the tax laws taxpayers should be aware of in preparing for the upcoming filing season," said Hukki, an Enrolled Agent of 34 years. "There are new credits to be aware of as well as extensions of previous credits you may qualify for."

One credit likely to benefit a large pool of taxpayers is the First Time Homebuyer's Credit for qualified buyers who purchased or will purchase a home between April 8, 2008 and July 1, 2009. The credit will either reduce how much you pay or increase your refund. The credit will give you 10% of the purchase price of your new home, up to a refundable credit of $7,500. According to Hukki, this credit is basically a zero interest loan, as it must be repaid over 15 years starting two years after the year in which you claim the credit. If you claimed the maximum credit of $7,500, your repayment would be an additional tax of $500 each year when you file your return.

There is still a tax credit available on certain hybrid vehicles. If you are planning to buy a qualifying hybrid vehicle, you should do it by December 31, 2008 to receive a tax credit. This credit is only allowed on a certain number of hybrid vehicles produced by each manufacturer. More information is available on the credit at http://www.irs.gov/newsroom.

This past October, President Bush signed into law the Emergency Economic Stabilization Act of 2008, which has more than 100 tax provisions worth over $150 billion in tax benefits. Included in the Act are:

* Another AMT patch to protect middle class taxpayers from paying the Alternative Minimum Tax or AMT, a tax originally intended for those who were not paying any income tax due to large write-offs or exempt interest income.

* Popular tax breaks for education, such as the $250 deduction for teachers who buy out-of-pocket classroom supplies, as well as the Tuition and Fees deduction for eligible taxpayers with higher education expenses.

* The option to deduct state and local sales taxes rather than just state income tax. This benefits taxpayers living in states where there is no state income tax (Florida, Texas, Alaska, Nevada, South Dakota, Washington and Wyoming).

* The option for IRA owners who have reached 70 ½ and must begin withdrawing money from their retirement accounts allowing them to contribute up to $100,000 tax -free to charity.

"It is very important taxpayers are aware of the changes Congress makes year to year to the tax code," said Hukki. "For many taxpayers, it is best to seek professional assistance to insure you are not missing out on any deductions or credits you might be entitled to."

Taxpayers can find more information on a larger range of tax changes for individuals at http://www.irs.gov/formspubs.

About JK Harris:

JK Harris & Company, LLC, (www.jkharris.com) based in North Charleston, S.C., is the nation's largest tax representation firm and has served over 225,000 customers since its founding in 1997 by John K. Harris. JK Harris consultants are available to meet with consumers in over 425 locations nationwide by appointment only. The company also provides services for student loan debt, fee-based financial planning, tax return preparation, and audit representation.