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Tax Services
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Got taxes? Seeking to reduce or better manage your tax liability? With today's constant changes in the tax law, businesses and individuals
cannot keep up and still continue to be involved successfully in their own work or business.
AFB Business Solutions takes a proactive approach to tax services by staying current on changing tax laws and legislation so you don’t
have to. AFB Business Solutions identifies key tax-planning opportunities that can minimize your current and future tax liabilities and help you
put these plans in action throughout the year.
AFB Business Solutions is available to provide you with an accurate assessment of your tax position and insure that your taxes are filed
accurately and timely . AFB Business Solutions is available to help you plan for the next tax year and how you can start now in preparing for
the future.
Act today, plan for tomorrow and beyond with timely tips on:
- Tax deductions
- Record keeping
- Financial strategy
- Home & business budgeting
- Retirement planning
- Deduction for your business
- And many more tax and individual and business strategy issues
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Tax Year 2009 Tax Updates
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Individual Tax Return Planning and Preparation
There were a number of changes to tax laws for Tax Year 2009. Below are a summary of those that could affect you.
- Making work pay - In 2009 and 2010, the Making Work Pay provision of the American Recovery and Reinvestment Act will provide a
refundable tax credit of up to $400 for working individuals and up to $800 for married taxpayers filing joint returns. This tax credit will be
calculated at a rate of 6.2 percent of earned income and will phase out for taxpayers with modified adjusted gross income in excess of
$75,000, or $150,000 for married couples filing jointly. Other provisions could apply.
- First-Time Homebuyer Credit Expands. Homebuyers who purchase in 2009 can get a credit of up to $8,000 with no payback
requirement. New legislation extends and expands this credit.
- Money Back for New Vehicle Purchases. Taxpayers who buy certain new vehicles in 2009 can deduct the state and local sales
taxes they paid or other taxes and fees they paid in states with no sales tax.
- Education benefits. The new American opportunity credit and enhanced benefits for 529 college savings plans help families and
students find ways to pay higher education expenses.
- ARRA and the Earned Income Tax Credit. The American Recovery and Reinvestment Act (ARRA) provides a temporary increase in
the earned income tax credit (EITC) for taxpayers with three or more qualifying children. ARRA also increases the beginning point of the
phaseout range for the credit for all married couples filing a joint return, regardless of the number of children. These changes apply to
2009 and 2010 tax returns.
- Energy Efficiency and Renewable Energy Incentives. The American Recovery and Reinvestment Act (ARRA) provides numerous
tax incentives for individuals to invest in energy-efficient products.
- Health Coverage Tax Credit. The credit increases from 65 percent to 80 percent of qualified health insurance premiums, and more
people are eligible.
- Tax rate changes. Tax rates are updated for tax year 2009. Although social security and medicare rates remain the same, the wage
limit for social security is $106,800 while medicare is unlimited. Mileage rates are:
- Relocation - .24 per mile
- Medical - . 24 per mile
- Charitable - .14 per mile
- Independent Contractors Receive Greater Scrutiny. If you work as an independent contractor, be prepared for closer scrutiny.
Be aware of the rules governing independent contracting.
Business Tax Planning
- COBRA: Health Insurance Continuation Subsidy. The American Recovery and Reinvestment Act (ARRA) of 2009 establishes an
employer-provided subsidy for employees who involuntarily lose their jobs.
- Energy Efficiency and Renewable Energy Incentives. The American Recovery and Reinvestment Act (ARRA) provides numerous
tax incentives for businesses. Certain equipment qualifies for incentives.
- Net Operating Loss Carryback. Small businesses can offset losses by getting refunds on taxes paid up to five years ago. Information
on the carryback, an expanded section 179 deduction and other business-related provisions, is now available. Small businesses with
deductions exceeding their income in 2008 can use a new net operating loss tax provision in the American Recovery and Reinvestment
Act (ARRA)to get a refund of taxes paid over the past five years instead of the usual two.
- Section 179 Deduction. A qualifying taxpayer can choose to treat the cost of certain property as an expense and deduct it in the year
the property is placed in service instead of depreciating it over several years. Under ARRA, qualifying businesses can continue to
expense up to $250,000 of section 179 property for tax years beginning in 2009. Without ARRA, the 2009 expensing limit for section
179 property would have been $133,000. The $250,000 amount provided under the new law is reduced if the cost of all section 179
property placed in service by the taxpayer during the tax year exceeds $800,000.
- Reduction of Estimated Tax Payment. Normally, small businesses have to pay 110 percent of their previous year’s taxes in
estimated taxes. The Recovery Act permits small businesses to reduce their estimated payments to 90 percent of the previous year’s
taxes.
- Extension of Bonus Depreciation Deductions Through 2009. Bonus depreciation is extended through 2009, allowing businesses
to take a larger tax deduction within the first year of a property’s purchase.
- Capital Gains Tax Break for Investment in Small Business. Investors in small business who hold their investments for five years
can exclude from taxation 75 percent of their capital gains.
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