The Tax & Accounting business of Thomson Reuters has revised its RIA 2011 Federal Tax Handbook to include all information from the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010.
The act, which was signed into law Dec. 17, 2010, affects more than 175 sections of the Tax Code, with many provisions impacting the 2010 taxable year and current filing season. To address many tax practitioners’ preference for a single, convenient, fully updated source containing coverage of the Tax Relief Act of 2010 and other late-breaking December 2010 tax legislation, Thomson Reuters is issuing a newly revised edition of its handbook.
Some provisions discussed in the newly revised 2011 RIA Federal Tax Handbook include:
• For 2011 and 2012, current individual income tax rates continue with a maximum of 35 percent.
• There will be no reduction in itemized deductions or a phase-out of personal exemptions for higher-income individuals in 2011 and 2012.
• First-year 100 percent bonus depreciation allows businesses to write off 100 percent of their new equipment and machinery purchases in the placed-in-service year, effective for property placed in service after Sept. 8, 2010, through Dec. 31, 2011. For property placed in service in 2012, there is a 50 percent additional first-year bonus depreciation.
• For tax years beginning in 2012, the maximum expensing amount is $125,000 and the investment-based phase-out amount is $500,000.
• For 2011 and 2012, the top tax rate on qualified dividends and long-term capital gains remains at 15 percent.
• For 2011, employees and self-employed workers get a reduction of two percentage points in Social Security tax in 2011, bringing the rate down to 4.2 percent (from 6.2 percent) for employees and down to 10.4 percent (from 12.4 percent) for the self-employed.
• For 2010 and 2011, a two-year alternative minimum tax "patch" provides a modest increase in the current AMT exemption amounts and allows personal nonrefundable credits to offset AMT as well as regular tax.
• The exemption amount for estate and generation-skipping taxes for 2011 and 2012 is $5 million and the maximum is 35 percent. For estates of decedents dying after 2010, a new portability feature for married couples allows the transfer of any unused exemption to the surviving spouse. The estate tax repeal for 2010 is preserved, if an estate elects that option, along with the accompanying modified carryover basis rules.
For more information on the revised RIA Federal Tax Handbook, call 1 (800) 950-1216.
