|
 Accounting
| Robert L.
Omer, CPA
Robert L. Omer
is a certified public accountant with RLO & Company, a team
of professionals with more than 56 years of combined tax,
accounting and consulting experience. RLO & Company is a
team of professionals with over 56 years of combined tax,
accounting and consulting experience. RLO & Company and
other professionals form this multi-disciplined practice that
offers Tax, Accounting, Estate Planning, Controller Services,
QuickBooks Training, Business Consulting and Strategic Business
Planning services. Contact us at 412-279-8110 or
www.rlocompany.com to arrange a one hour free consultation for
all new clients.
You
Still Have Time To Save
With only a month
left in the year, you still have time to save money on your 2007
taxes. Your year-end tax planning may be a little more
challenging than usual because of the uncertainty over when and
how Congress will extend a number of important tax breaks due to
expire at the end of 2007. For individuals, these include the
option to deduct state and local sales and use taxes, and
above-the-line deductions for qualified tuition expenses and
educator expenses.
This also may be
the last year to get tax credit on qualified energy saving
improvements to your home, such as installation, doors, roofs,
heating and cooling equipment and energy-saving windows. The tax
credits can range from 30 percent credit up to $2,000 for solar
water heating or photovoltaic equipment to 10 percent up to $500
for insulation.
There may be
actions you should consider taking now that may provide you with
tax breaks for 2007-2008, including:
If you think you
have set aside too little in your employer’s health flexible
spending account, increase that amount for next year. Remember,
you get tax-free reimbursement for over-the-counter drugs, such
as aspirin and antacids.
If you have any
capital gains or losses from sales of stock or other capital
assets or you have assets that are ripe for sale, talk to your
tax accountant on how to best coordinate the timing of your
gains and losses to minimize your tax liability and maximize the
benefit from your losses.
If you’re
thinking of buying a new hybrid gas-electric car or truck
eligible for tax credit, confirm the model still qualifies, and
buy it before the end-of-the-year.
Self-employed
individuals should consider setting up a self-employed
retirement plan.
If you’re
thinking of donating a used auto to charity, check to see if
they are going to sell it or use it in their charitable
activities. If they plan to use it, it may provide a bigger
deduction for you.
If you’re
self-employed, you may contribute up to 25 percent of your
self-employment income (gross income minus expenses) to a SEP
account and deduct the full amount. (You can make this
contribution up to the date of your return which, with
extensions; can be as late as October 15th.)
This year, the
kiddie tax rules apply to kids under the age of 18; next year it
will also include most full time students aged 19 through 23! If
your child holds appreciated stock and isn’t in the kiddie tax
bracket, but will be caught next year in the extended age
bracket, you may want to consider having them sell the stock
this year. This may result in a 5 percent tax on the gain, vs.
15 percent if it is sold next year.
Making the most of
the 2007 tax breaks can make a difference in your deductions and
taxable income. Some of these changes have increased limits for
tax deferred retirement savings, others have increased
deductible expenses. There are a number of changes that might
affect you:
Income limits rose
for making contributions to a Roth IRA. For joint filers the
range is $156,000 and $166,000, up from $150,000 to $160,000 in
2006. For most singles in 2007, the range is $99,000 to
$114,000.
Retirement savings
have increased. The maximum amount you can contribute to a
401(k) plan has gone up to $15,500 from $15,000 in 2006. If you’re
50 or older, check with your accountant about the additional
increase of $5,000, for a total of $20,500.
Be sure to track
your business mileage. This year, the rate for calculating
deductible costs of using your car for business is 48.5 cents a
mile, up from 44.5 cents last year. The rate for medical and
moving miles is now 20 cents per mile, up from 18 cents.
If you recently
bought and paid for mortgage insurance this year, check with
your accountant to see if you qualify for a deduction under a
new 2007 tax law.
You still have time
to take advantage of the 2007 tax laws, just take the time to go
over these tax changes with your accountant before December
31st. Bring in the New Year knowing you have made the most of
the 2007 tax year!
IRS Circular 230
disclosure: To ensure compliance with requirements imposed by
the IRS, we inform you that any tax advice, if any, contained in
this communication (including, unless otherwise provided, any
attachments) was not intended or written to be used, and cannot
be used, for the purpose of (I) avoiding tax-related penalties
under the Internal Revenue Code or (ii) promoting, marketing or
recommending to another party any matter(s) addressed herein. |
'Tis
the Season
