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October 2010
Issue: 32
Only 10 Days Left to File 2009 Individual Income Tax Returns
 
If you filed an extension for your 2009 Individual Income Tax Return, then you must have your return filed by October 15th.  If you still need to file, then please contact us immediately so we can make arrangements to get your return filed by the deadline and ensure you will avoid any penalties and interest.  It is important that you file your return by the deadline so you don't miss out on several tax breaks that are available only if you file by the deadline.  Please contact us immediately if you still need to file your 2009 tax return.  The sooner you get your information to us the better.
 
Last month, Congress passed the Small Business Jobs Act which contained several tax breaks for small business.  I included an article explaining several of the tax breaks included in the bill.  If you need any addiitonal information or if you are curious if you will benefit from any of the tax breaks, please contact us and we'll be happy to help explain the changes to you.
 
Enjoy this month's newsletter!
 
Go Twins!
Strategies to Reduce Taxes on Social Security
 
You worked hard all your life, paying into the Social Security system. Now you're ready for payback time. Not so fast. Uncle Sam may want a piece of your benefits. Up to 85% of Social Security benefits may be subject to federal tax, but tax planning can help ease the pain.
 
The tax hit will depend on your income and marital status. First figure your modified adjusted gross income, which includes non-Social Security sources of taxable income, such as pensions, wages, interest and dividends. Add in tax-exempt interest and certain other exclusions from income. Itemized deductions won't help you in this calculation.
 
 
With the downturn in the economy and massive job losses, personal bankruptcy filings have exploded. According to the National Bankruptcy Research Center, approximately 1.4 million bankruptcies were filed in 2009, a 32% increase over 2008. They included Chapter 7 bankruptcy filings, which increased 42%, and Chapter 13 filings, which increased 12%. Bankruptcies in 2010 may be fewer than last year. However, in early January, The Wall Street Journal reported that bankruptcy attorneys had not yet experienced a slowdown in their workload.
 
CPA clients may be among those needing bankruptcy protection. Many of these clients may benefit from including federal tax debts in their petition.
 
In This Issue
Strategies to Reduce Taxes on Social Security
Discharging Taxes in Bankruptcy
House OKs Small Biz Jobs Bill
Upcoming Tax Deadlines

House OKs Small Biz Jobs Bill 

One week after the Senate passed a $42 billion bill aimed at helping small businesses, the House voted Thursday to send the bill to President Obama's desk.
 
The measure, which passed the House in a 237 to 187 vote, is aimed at creating 500,000 jobs, according to a Senate summary of the bill. The Small Business Jobs Act also is intended to make credit more available for Main Street and enacts about $12 billion in tax breaks.
 

Upcoming Tax Deadlines

October 15th - Extended deadline to file 2009 individual income tax returns
 
November 1st - Quarterly federal and state payroll tax returns are due for the 3rd Quarter.
 
Please let us know if there is anything we can do for you!!

Thomas R. Vetscher, CPA
John T. Vetscher, CPA

651-690-2250

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