Just before closing up shop and heading out on the campaign trail, Congress passed legislation requiring federal agencies, including the IRS, to use “plain writing” in documents issued to the public, including those issued electronically (in other words, materials posted on agency websites). Alarm bells went off here at Fairmark.com, as this development threatens to put us out of business. We were relieved at what we learned in digging a bit deeper. (more…)
Archive for September, 2010
Congress to IRS: Eschew Obfuscation
Thursday, September 30th, 2010Small Business (and Roth Changes) a Done Deal
Friday, September 24th, 2010The House of Representives has passed the Small Business Jobs Act of 2010, offering various tax breaks aimed at small businesses, and unrelated provisions expanding access to Roth accounts in employer plans. Some of the provisions take on the date of enactment, which will be Monday, September 27, the day President Obama signs it into law. In a separate article we’ve posted questions and answers about Roth conversions within employer plans.
Roth Conversions Within Employer Plans
Friday, September 24th, 2010As of September 27, 2010, employees with 401k or 403b accounts can do a Roth conversion without taking money out of the plan — but only if the employer takes steps necessary to permit these conversions. Here are questions and answers about these provisions. (more…)
Weekly Wrapup
Monday, September 20th, 2010News this week includes Senate approval of the Small Business Jobs Act of 2010, which includes expanded access to Roth accounts. (more…)
Relief for Estates with Basis Problem?
Tuesday, September 14th, 2010This year’s temporary expiration of the estate tax may be a boon for heirs of very wealthy decedents, but actually increases the amount of tax paid by many other heirs. In years when the estate tax applies, the basis of assets held by the decedent is adjusted to the fair market value of the assets on the date of death, so that heirs can sell assets at that value without reporting a capital gain. This year, because the estate tax doesn’t apply, this basis adjustment is subject to a dollar limitation (see Property Received from 2010 Decedents for details). It’s possible for heirs of 2010 decedents to be better off under the rules that were in effect in 2009, when the generous exemption amount and unlimited marital deduction may have protected them from paying estate tax while the unlimited basis adjustment would also have protected them from paying tax on capital gains that were built-in at the time of the decedent’s death. (more…)
Deadline Looms for Homebuyer Credit
Saturday, September 11th, 2010If you entered into a contract to buy a home by the end of April, you have until the end of September to close on the purchase if you want to claim the homebuyer credit. For details see the IRS guidance here.
Friday Wrapup
Friday, September 10th, 2010We skipped some Fridays in August when there wasn’t much to wrap up, but we’re back with more news and features. (more…)
Planning for Higher Capital Gains Rates
Thursday, September 9th, 2010For people in the higher tax brackets, capital gains rates are likely to be higher in the near future. Many investors may wonder whether they should cash gains before the end of the year. Our analysis reveals that this strategy won’t always produce benefits. Paradoxically, some people end up with better results when paying more tax. (more…)
Reimbursement for Over-the-Counter Drugs
Tuesday, September 7th, 2010As of January 1, 2011, over-the-counter drugs purchased without a prescription will no longer be eligible for reimbursement from health reimbursement accounts and flexible spending accounts (HRAs and FSAs). Insulin purchases are not affected, but as of next year you’ll need a prescription for OTC drugs if you want to use funds in these accounts to pay for them. The IRS has issued guidance explaining this change in the rules. (more…)
