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Friday, January 20, 2017

Check's in the Mail


The Check’s in the Mail

It’s that time of year again; the cooler weather, snow days and the Property Tax Credit Checks.  Yes, you read that right!

If you own a home in New York State and your taxing district has complied with certain requirements, you may be receiving a check to offset the increase in your property tax bill.  This year, New York will include the $130 or $185 property tax relief credit in the same check.  Sorry New York City residents, this doesn’t apply to you, since you aren’t subject to the tax cap.

Will I get a check?
To be eligible for the Property Tax Freeze / Relief check, you must:
1    1.   Receive the STAR exemption
2    2.  Be located in a tax jurisdiction that remained under the NYS property tax cap and has an approved
           Government Efficiency Plan that reduces costs.
3    3.  Live in applicable counties (not NYC)
4    4.  Have income of $275,000 or less

How much will I get?
This is what everyone really wants to know.  The amount of the check is generally equal to the increase in your tax bill.  If there was no increase,  the State will multiply the previous year’s bill by an inflation factor (but no more than 2%), to determine the amount.  Your property tax relief credit, either $130 or $185 will be included as well.  The amount is $130 for Nassau, Suffolk, Orange, Putnam, Rockland Westchester, and Dutchess counties.  All other counties (except New York City) receive $185.

When will I receive my check?
Be on the look out this winter for your check, according the the State.  In past years, some homeowners received checks into January and beyond.

Tax time hint
Save that tiny stub that is attached to your check with your income tax documents, and note the date you received it.  Your CPA will need that information at tax time.

Honorine M. Campisi, CPA

Wednesday, January 4, 2017

Potential Tax Changes for Individuals in 2017


Potential Tax Changes for Individuals in 2017

As of 12/31/2016, there are certain tax provisions set to expire.  Some of the expiring provisions that will affect the average individual taxpayer are:
·         Credit for certain nonbusiness energy property
·         Credit for residential energy property
·         Discharge of indebtedness on principal residence excluded from gross income of individuals
·         Premiums for mortgage insurance deductible as interest that is qualified residence interest

According to most sources, President-elect Trump is likely to pursue the following individual tax legislation in 2017:
·         Reduce the individual marginal tax rate to three rates: 12, 25, 33% (2016 tax rates are 10, 15, 25, 28, 33, 35, 39.6%)
·         Top tax rate on capital gains and dividends 20%
·         Increase the standard deduction to $15,000 for singles and $30,000 for joint filers (2016 standard deduction is $12,600 for MFJ and QW, $9,300 for HOH and $6,300 for S)
·         Eliminate the deduction for personal exemptions (2016 personal exemption amount is $4,050 for the taxpayer, spouse and each qualified dependent, subject to limitation)
·         Eliminate the Head of Household filing status
·         Repeal and replace the Affordable Care Act (Eliminating the 3.8% tax on net investment income, the additional 0.9% Medicare tax on wages and SE income, penalties for failure to obtain health insurance and the premium assistance credit.)
·         Create a new above-the-line deduction for child and dependent care expenses
·         Increase the earned income credit for working parents through a spending rebate
·         The creation of Dependent CARE Savings Accounts with individual contributions matched 50% by government contributions
·         Impose a cap on the amount of itemized deductions that could be claimed on a tax return at $100,000 for single filers and $200,000 for joint filers
·         Eliminate the Alternative Minimum Tax

Sandra G. Johnson, CPA, EA, CFE

January 2, 2017

Thursday, August 18, 2016

Olympians Pay Tax on Medals


Olympic Medalists Pay Tax on Medals 


Olympic medal winners must report the value of the medals as income on their US tax returns.  Gold medals are worth an estimated $600, silver medals an estimated $300 and bronze medals a mere $4. In addition to the medals, Olympic athletes also receive a cash prize.  Gold medal winners receive $25,000, silver medal winners receive $15,000 and bronze medal winners receive $10,000.  Uncle Sam wants his share of the winnings.  
good tax accountant can possibly reduce the winner's tax burden.  If the athletes consider their Olympic career a business, they can deduct certain business expenses.  Possible deductions may include the cost of training, athletic equipment and travel, to name a few.  If the athlete considers his or her sport a hobby, he or she may be entitled to deduct expenses as Miscellaneous Itemized Deductions on Schedule A.


Sandra G. Johnson, CPA
August 18, 2016