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Archive for January, 2012

What to Do If You Are Missing a W-2

Make sure you have all the needed documents, including all your Forms W-2, before you file your 2011 tax return. You should receive an IRS Form W-2, Wage and Tax Statement, from each of your employers. Employers have until Jan. 31, 2012 to issue your 2011 Form W-2 earnings statement.

If you haven’t received your W-2, follow these four steps:

1. Contact your employer If you have not received your W-2, contact your employer to inquire if and when the W-2 was mailed. If it was mailed, it may have been returned to the employer because of an incorrect or incomplete address. After contacting the employer, allow a reasonable amount of time for them to resend or issue the W-2.

2. Contact the IRS If you do not receive your W-2 by Feb. 14, contact the IRS for assistance at 800-829-1040. When you call, you must provide your name, address, Social Security number, phone number and have the following information:

• Employer’s name, address and phone number

• Dates of employment

• An estimate of the wages you earned, the federal income tax withheld, and when you worked for that employer during 2011. The estimate should be based on year-to-date information from your final pay stub or leave-and-earnings statement, if possible.

3. File your return You still must file your tax return or request an extension to file by April 17, 2012, even if you do not receive your Form W-2. If you have not received your Form W-2 in time to file your return by the due date, and have completed steps 1 and 2, you may use Form 4852, Substitute for Form W-2, Wage and Tax Statement. Attach Form 4852 to the return, estimating income and withholding taxes as accurately as possible. There may be a delay in any refund due while the information is verified.

4. File a Form 1040X On occasion, you may receive your missing W-2 after you file your return using Form 4852, and the information may be different from what you reported on your return. If this happens, you must amend your return by filing a Form 1040X, Amended U.S. Individual Income Tax Return.

Form 4852, Form 1040X and instructions are available on this website or by calling 800-TAX-FORM (800-829-3676).

December 2011

Dear Clients,

As 2011 comes to an end, changes in the tax world seem to be on the horizon. Many individual and business tax incentives are scheduled to expire after 2012. Presidential election years tend to bring change, so it will be interesting to see how everything plays out. The following is a list of tax changes, updates, and items of interest:

  • Set to expire after 2011 include the allowance for 100% first-year bonus depreciation (Sec. 168(k)), and the expiration of the increased deduction amounts under Sec. 179. The Sec. 179 expensing limitation for new fixed asset purchases is reduced to $25,000 for 2012.
  • The temporary extension of the decreased payroll tax relief is set to expire on February 29, 2012 for the employee’s portion of the tax. Without further legislative action, the rate will then revert back to 6.2%.
  • Standard business mileage rates beginning January 1, 2012 have been set at $0.555 per mile for business miles driven, $0.23 per mile driven for medical or moving purposes, and $0.14 per mile driven in service of charitable organizations.
  • Social Security benefits will go up 3.6% in 2012 which is the first hike in two years. Earnings limits will also increase. Individuals who turn 66 during 2012 will not lose any benefits if they earn $38,880 or less before reaching that age. Individuals 62 to 66 can make up to $14,640 before losing benefits, and there is no earnings cap once a beneficiary turns 66.
  • Retirement plan ceilings increase in 2012. The maximum 401(k), 403(b), and 457 plan contributions rises to $17,000 ($22,500 for individuals age 50 and older). The ceiling for SIMPLEs will remain at $11,500 ($14,000 for individuals age 50 and older).
  • Remember, Health Savings Account and IRA contributions can be made until April 17, 2012 as a 2011 contribution. Health Savings Account contribution limits for Self-Only and Family are $3,050 and $6,150, respectively, with a $1,000 additional contribution for individuals 55 or older. Traditional and Roth IRA limits for 2011 are $5,000 with an additional $1,000 for individuals 50 or older.

We at Neil & Company CPAs P.C. will continue to monitor any income tax changes passed during 2012 and will pass those along to you. We look forward to 2012 and promise to continue our commitment to you to provide the most consistent and valuable financial assistance!