Accounting News and Notes

Snellville/Lilburn/Norcross/Tucker CPA…2012 Tax Rules & Guidelines

The old adage that you better guard your families and your wealth while Congress is in session has never been more true so tighten down the hatches. Though many in this economy think things will soon return to normal. I believe “this is the new normal.”

The IRS has just announced that effective January 1, 2012 the standard mileage rates for business use of a vehicle (also vans, pickups or panel trucks) will be:
• 55.5 cents per mile for business miles driven
• 23 cents per mile driven for medical or moving purposes
• 14 cents per mile driven in service of charitable organizations
Unless Congress changes it and the President signs it the 2012 amounts for taxes will be:
• The maximum wages that Social Security Taxes will be paid on is $110,100 with the Social Security percentage being 6.2% with the maximum that can be taken out of an employee’s paycheck to be $6,826.20
• There is no maximum on the 1.45% of wages due for Medicare
• Social Security wages will become taxable of your AGI/Adjusted Gross Income exceeds $44,000 if Married Filing Jointly and $34,000 if filing Single.

For Qualified Retirement Plans:
• The maximum elective deferral for a 401K is $17,000 and for a SIMPLE IRA is $11,500.
• Individuals who are 50 years of age and older by year end can also make a catch-up provision of $5,500 for 401K plans and $2,500 for SIMPLE plans.
• The maximum contribution for a SEP/IRA is the lesser of 25% of your W-2 (or net earnings if an LLC or proprietorship) or $49,000.

Selecting the Proper Type of Retirement Plan for Your Business
Whether you are just getting started or have been in business for years, selecting amongst the varied retirement plans requires the skill of a surgeon and the grace of an artist. To learn more visit http://www.hiscpa.com/retirement-planning.html

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This entry was posted on Tuesday, January 3rd, 2012 at 7:09 am and is filed under Income Tax Preparation of Corporate & Personal Income Taxes.
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