Mike's weekly post usually concentrated on tax saving strategies.
Now is the time to review your paycheck to ensure you have proper withholdings for 2012. Tax rate brackets have been expanded in 2012 so more income will be taxed at lower amounts. However, unique to 2012 is the expiration of the social security 2% tax break. As you recall all employees had their social security tax rate reduced from 6.2% to 4.2% for 2011. This one-year tax provision will become a hot topic for the balance of the year in Congress.
Ensuring your cell phone business use is deductible
With the proliferation of cell phones, and the corresponding accessibility of you to your employer, invariably most employees are receiving and making business calls on their cell phones. So how can you deduct your cell phone expenses on your tax return? Here are some ideas and tips:
Expense Report. If you are an employee and use your cell phone regularly for work, review your employer's policies regarding the ability to expense part of the cost. If properly documented, the reimbursed business expense for cell phone use is not income to you. Not sure? Ask your employer. It never hurts to make a reasonable request.
Ensuring your cell phone business use is deductible
With the proliferation of cell phones, and the coresponding accessibility of you to your employer, invariably most employees are receiving and making business calls on their cell phones. So how can you deduct your cell phone expenses on your tax return? Here are some ideas and tips:
Are you getting the tax break you deserve?
Taxpayers often overlook and underreport their charitable contributions on their tax return. And while there are no hard statistics, the Treasury Department is not looking out for you to ensure you are reporting all your deductible charitable giving. So what can you do to maximize your deduction?
Every industry and profession has common terms that are used so often those of us in the business often forget that most people do not have the depth of understanding that a person working within the tax code might have. One of these areas is understanding the differences between the tax terms "deductions" and "credits". Is one better than the other?
Top line. Dollar for dollar, a credit is worth more to you than a deduction. Why? A credit is a direct reduction in tax, while a deduction reduces the amount of income that gets taxed. Here is a simple chart showing the difference.
