Individual Tax Returns | |
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Current Developments | |
Clock Ticking On Extended NOL Election | Federal Stimulus Plan Provides Major Tax Reductions for Individuals |
| On August 13, the IRS issued a news release reminding taxpayers that time is running out on the ability to elect an extended carry-back period for a 2008 Net Operating Loss (NOL). Under provisions enacted as part of the American Recovery and Reinvestment Act of 2009 (ARRA), most corporations wishing to carry losses back more than the statutory two years must elect by September 15 of this year, and most individuals must file their election no later than October 15. The ARRA election permits taxpayers to who qualify to carry back their 2008 NOL for three, four, or five tax years. More... | On Friday evening, February 13, 2009, both houses of Congress reached agreement on a historic federal stimulus plan projected to cost almost $800 billion. The new plan, named the American Recovery and Reinvestment Act of 2009 (ARRA, or The Recovery Act), was signed by President Obama in a ceremony in Denver on February 17. According to the Congressional Joint Committee on Taxation (JCT) estimates, about 30% of ARRA's benefits are in the form of tax breaks for individuals ($232 billion), while the bill contains approximately $80 billion in business and energy tax reductions. More... |
Alabama Farmers Qualify for Tax Break Due to DroughtAlabama cattle farmers may be eligible for an extended period of time in which to reinvest the proceeds of livestock sales in order to avoid paying tax on the profits, if the sales were forced by drought conditions. Such sales are considered to be "involuntary conversions" under Internal Revenue Code Section 1033(e)(2), and farmers have up to four years to reinvest the proceeds in property that is "simlar or related in use" to the converted property. A reinvestment within the required period allows the farmer to defer reporting the gain on the sale while reducing the basis of the replacement property by the amount of the gain not reported. The Alabama Code adopts federal Section 1033 by reference, so its benefits will be available on the farmer's Alabama return also. More... |
Six Alabama Counties Get Favorable Tax Credit DesignationSix Alabama counties (Butler, Dallas, Macon, Perry, Sumter, and Wilcox) have been designated as "Rural Renewal Counties" by the Internal Revenue Service. The significance of the designation is that employers may be eligible for a credit of up to 40% of the wages paid to employees who are residents of the six counties and who begin work for the employer after May 27, 2007. The employer does not have to be located in the rural renewal county to claim the credit. The credit, referred to as the "Work Opportunity Tax Credit", is provided by Section 51 of the Internal Revenue Code. Eligible employees include persons who are between the ages of 18 and 39. The six Alabama counties were selected, along with rural counties from 31 other states, because they experienced a net decline in population between the years of 1990 - 1994 and 1995 - 1999. Employers who think they may have eligible employees should contact their tax advisor immediately, since there is a "pre-screening" form (Form 8850) that must be completed within 28 days of the employee beginning work. |
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