We are often asked what a client should bring to us in order to prepare their taxes. Bringing the right information can assist us in preparing the most accurate return possible, and help keep your fees reasonable. If we have to assemble data on a client’s behalf, that ends up costing the client more.
So here we go…
With the new year fast approaching there are some things you should be aware of. The elections are over but the House and the Senate have limited days in session before they break for the Christmas holiday, so it's not certain how some of these items will be decided. As we have more information we will keep you updated.
FUTA TAX: California is still listed as a credit reduction state which means they still have not repaid federal loans that help fund unemployment payments. This means we will see another .3% increase to the FUTA taxes this year. Added to last year's .3% increase makes the FUTA rate increase for 2012 be .6% bringing the total rate to 1.2% . The increase will likely be retroactive to January 1, 2012 which will require additional FUTA tax to be paid at year end.
Federal withholding is scheduled to increase for 2013 unless lawmakers extend the tax cuts before December 31, 2012.
Social Security "tax holiday", if not extended, will expire on December 31, 2012 which will make the employee portion of Social Security once again be 6.2%. It does not look like this will be extended.
State run retirement plans: In California, lawmakers recently passed initial legislation that could create the nation's first state-run retirement plans (SB1234) for private-sector workers. All employers would need to automatically set-up a 3% savings program unless the employee opts out. No information yet on when or if this will be effective.