Olsen Thielen & Co., Ltd. has released the 2010-2011 edition of their annual Tax Planning Guide. Based on the passage of several pieces of legislation (2010 Patient Protection & Affordable Care Act, Education Jobs Act of 2010, and the Small Business Jobs Act of 2010), there are new and revised ways that you can reduce your tax burden. Because some of these tax benefits are time sensitive, it is important that you act quickly before year-end to take advantage of them.
The 2010-2011 Tax Planning Guide explains how to not only take advantage of the changes in the tax law, but also how to use proven strategies to minimize taxes on your personal and business income. It gives you many tax-smart ideas about investing, education funding, estate planning, and saving for retirement. Check out the online version of the 2010-2011 Tax Planning Guide. This online version is continuously updated as new legislation is passed. 
A few highlights from recent tax legislation to which we’d like to draw your attention are:
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Section 179 Expensing Election – the expensing limit is $500,000 for 2010 and 2011.
- Bonus Depreciation – extension of the 50% first year write-off on qualified assets placed in service during 2010.
- The Small Business Jobs Act of 2010 extends and expands numerous tax breaks for businesses. See pages 8 and 9 for further discussion.
- Small businesses with fewer than 25 full-time equivalent employees with average annual wages of less than $50,000 may be eligible for a tax credit if they pay health insurance for employees. See page 10 for further discussion.
- Long-term capital gain rate remains at zero for capital gains that would be taxed at 10% or 15% based on the taxpayer’s regular income tax rate. These low tax rates will expire as of December 31, 2010. See page 6 for more planning ideas.
- Roth IRA Conversions – taxpayers with adjusted gross income exceeding $100,000 now qualify to convert a traditional IRA to a Roth IRA, similar to those with adjusted gross incomes of less than $100,000. This conversion is taxable in the year of the rollover. For conversions made in 2010 only, the income can be recognized over two years (2011 and 2012). See page 13 for further discussion.
- A one-year repeal of the estate and generation-skipping transfer taxes is currently in effect for 2010. See page 14 for further discussion.
- The gift exclusion remains at $13,000 per recipient for 2010.
Olsen Thielen can help answer any questions about state and federal tax law, the changes listed above, or other tax matters. We can also review your current tax and financial standing and develop a plan that makes sense for your family or company. We want to help you keep more of your hard-earned money.