New Accounting & Tax Software

 David M. Hippchen, CPA, PC has converted their accounting and tax software to Thomson Creative Solutions/UltraTax — a dynamic, centralized platform that enables our firm become efficient through enhanced integration, centralized management and simplified maintenance. The generation of Creative Solutions is built on the strength of a common client database, shared by all its applications and is a SAAS applications. SAAS (Software As A Service) allows our staff to access the Thompson secure Client Portal to access our software and data and backs updates and backs up our software/data.  Thomson is a leading provider of information services, software and workflow tools for tax, accounting, legal and business professionals.

Expired Tax Credits You Need To Be Aware Of

Prepare Now for Expiring Tax Benefits

The Emergency Economic Stabilization Act extended more than 30 tax provisions that were set to expire and also created a series of new tax breaks with expiration dates. Additionally, many of the tax laws signed by ex-President Bush also included expiration dates. While an ever evolving tax code does not create simplicity, it does create the opportunity to reduce your tax burden. Many of these credit were extended at the end of 2010 for 2011 and 2012.

In order to minimize your taxes in future years, you should be aware of the various provisions that are set to expire and take advantage as best you can. There are at least 113 tax provisions that are set to expire. While many of these provisions get extended by Congress year after year, next year may be different. There is no doubt the US Treasury needs additional revenue and Congress may let many of these provisions expire. Here is a list of some of the more significant provisions for businesses and individuals that are set to expire over the next two years:

Reduced capital gains rate – The current long term capital gains rates are capped out at 15 percent. These rates are set to expire at the end of 2012, at which time the maximum rate will increase to 20 percent. The President has stated that he does not intend to extend this tax provision after it is set to expire (or at least reduce the impact of the provision), so do not expect much relief in the way of capital gains.

Reduced dividend rate – Dividends are currently taxed at capital gains rates (currently maxed out at 15 percent). This provision is set to expire at the end of 2012, at which time dividends will be taxed as ordinary income. Ordinary income currently has a maximum tax rate of 35%. I expect some relief on dividends for lower income persons, but those with higher incomes will likely be paying additional taxes on their dividends in 2011.

Deduction for school teachers – Teachers that purchase supplies for their classroom can receive a deduction of up to $250. This is expected to be continued through 2012. The teachers union obviously has significant clout with the current Administration and Congress.

Making work pay tax credit – Working individuals will received a tax credit in 2009 and 2010 up to $400. Couples will receive up to $800. This law expired for 2011, but a 2% credit was made on your social security tax to compensate for this.