Up to a 95% tax break for employer provided child care

For those of you with small businesses out there, opportunity exists for an up to 95% tax savings for providing child care for your employees. The tax savings involves the following items: federal employer child care credit, California employer child care credit, federal income tax deduction, California income tax deduction, FICA savings.

The maximum credit can be obtained by paying up to $100 per month, per child in qualifying child care payments. Payments must be made directly by the employer to the qualifying child care provider. Care must be provided under the authority of a license when required by California law. Read more

IRS Launches First Smartphone Apps

The IRS announced it has released its first smartphone application, IRS2GO. The app allows people to check their refund status, get daily tax tips, and follow the IRS news feed on Twitter all through their Apple or Android platform smartphones.

To check a refund status, users will need their social security number, filing status, and expected refund amount from their 2010 tax return. Per the IRS website, sensitive information such as social security numbers will be masked and encrypted for security. If you e-file your return you can use the app to check the status of your refund within 72 hours of the IRS’s acceptance of the return. Paper filers will have to wait 3-4 weeks.

The app will also let users subscribe to Tax Tips. The IRS issues tax tips daily during the filing season and periodically during the rest of the year. The tips are designed to be easy to understand and provide users with information on tax planning and preparation.

Finally, if you are so inclined, you can follow the IRS Twitter news feed, @IRSnews. The Twitter feed provides the latest news, tax law changes, and information on IRS programs in short, timely messages.

The app is free and can be downloaded from the Apple App Store or the Android Marketplace.

Congratulations to Jennifer Hauck

LMGW Certified Public Accountants, LLP would like to congratulate Jennifer Hauck, Supervising Senior Accountant for completing her Enrolled Agent (EA) exam.

Jennifer has been with LMGW for 8 years.  She serves both individual and business tax clients, providing consulting services for bookkeeping, tax preparation, and tax planning.

Small Nonprofit Filing Requirements with the IRS and FTB

The Internal Revenue service issued new guidance January 13, 2011 that allows for additional small nonprofits to file a simpler tax form that contains far less information than was previously required.  Small nonprofits may be able to file Form 990-N also known as an e-Postcard for their 2010 annual information reporting as long as they receive less than $50,000 per year. Read more

Delayed Filing Season for Some Taxpayers

Following the recent law changes passed in late December 2010, the IRS issued News Release IR-2010-126 announcing a delay in processing certain tax returns in order to allow the IRS time to revise applicable tax forms and update its processes for the law changes. If you fall into any one of the three categories below you can expect the filing of your tax return to be delayed until mid to late February:

•Taxpayers claiming itemized deductions on Schedule A.

•Taxpayers claiming the Higher Education Tuition and Fees Deduction. However, the IRS emphasized that there will be no delays for taxpayers claiming other education credits such as the American Opportunity Tax Credit and Lifetime Learning Credit.

•Taxpayers claiming the Educator Expense Deduction. This deduction is for kindergarten through grade 12 educators with out-of-pocket classroom expenses of up to $250.

The delay affects both paper and electronically filed returns. The IRS is expected to announce a specific date when it will begin processing tax returns impacted by the law changes. For more information and updates, visit www.irs.gov.