January ‘11 Issue
Wisconsin Association of Accountants 1-800-237-4080 - 715-425-0482 - www.wiassociationofaccountants.com
by Bob Jennings
(800) 333-3333 IRS Kicks Off 2011 Tax Season
June 23 - 24
with Deadline Extended to April 18;
Estates & Trusts
by Bob Jennings Taxpayers Impacted by Recent Tax
Breaks Can File Starting in Mid- to
September 18 - 20 Late February
Submitted by IRS
WAA Annual Convention
Marriott Milwaukee West WASHINGTON — The Internal Revenue Service today opened the 2011 tax filing season by announcing
thattaxpayers have until April 18 to file their tax returns. The IRS reminded taxpayers impacted by
October 3 - 4 recent tax law changes that using e-file is the best way to ensure accurate tax returns and get faster
Bob Jennings refunds.
Wisconsin Dells Taxpayers will have until Monday, April 18 to file their 2010 tax returns and pay any tax due because
Emancipation Day, a holiday observed in the District of Columbia, falls this year on Friday, April 15.
By law, District of Columbia holidays impact tax deadlines in the same way that federal holidays do;
October 24 - 25 therefore, all taxpayers will have three extra days to file this year. Taxpayers requesting an extension will
Federal Tax Update have until Oct. 17 to file their 2010 tax returns.
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The IRS expects to receive more than 140 million individual tax returns this year, with most of those
being filed by the April 18 deadline.
November 7 - 8
Gear Up 1040 The IRS also cautioned taxpayers with foreign accounts to properly report income from these accounts
Waukesha and file the appropriate forms on time to avoid stiff penalties. “The IRS has made important strides at
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stopping tax avoidance using offshore accounts,” said IRS Commissioner Doug Shulman. “We continue
to focus on offshore tax compliance and people with offshore accounts need to pay taxes on income
November 28 - 29 from those accounts.”
1040 Update The IRS also reminded tax professionals preparing returns for a fee that this is the first year that
they must have a Preparer Tax Identification Number (PTIN). Tax return preparers should register
(877) 254-5466 immediately using the new PTIN signup system available through www.IRS.gov/taxpros.
December 5 - 6
Gear Up 1040
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Continued on page 3
THE WISCONSIN ACCOUNTANT pAGE 2
Executive Corner . . .
. . . . . WAA Officers . . . . .
Thomas M Adler, CPA, ATA, ATP
1110 Fourier Dr Ste 110
Madison, WI 53717 As I look out my window and the snow is falling and blowing off
(608)664-1944 my office roof, I know we are in for a typical winter in Wisconsin .
Your WAA board has planned a schedule of seminars for 2011
Vice Presidents: in beautiful hotels spread through out the state. There will be
Glen Johnson, EA, ABA, ATA something for everyone covering topics varied from Bob Jennings
3707 Hamilton Av
Altoona, WI 54720 - Technology to Estate and Trusts to many differing approaches
(715)832-5779 Byron Dopkins, to income tax in the fall, business and personal taught by
firstname.lastname@example.org Executive Director professional speakers who also do taxes on a regular basis. Our
Jolynn McIntosh, CPA convention in September at the Mariott Milwaukee West will
1124 17th Av feature many speakers on many topics. Our calendar of events will be out soon. The
Monroe, WI 53566 specific dates and locations are available on our website.
Remember in the busy time – get adequate rest and eat healthy food – we will see
Secretary: you in the spring!
De Anne Chappell, EA, ABA, ATP, ATA
PO Box 68
Boscobel, WI 53805 Byron L Dopkins, EA, ABA
WAA Executive Director
James Badertscher, EA, ABA
112 West 5th St
Marshfield, WI 54449
From the president . . .
NSA State Director:
Jim Weickgenant, EA, ATA
612 S Blvd People say accountants are boring!! How could that be with us
Baraboo, WI 53913 being busy getting W-2’s, 1099’s, and payroll tax reports done
(608)356-9494 by the end of the month.
Past President: I do not know why some clients do not understand deadlines or
William E Suttner, CPA due dates. They must reduce stress by being late or believing
PO Box 187
Chilton, WI 53014 someone has to be last.
email@example.com I hope the notes Bill Suttner had you make last year and the
Directors: WAA training will make for a better tax season. Keep notes for this year to improve
Mary Jo Boldt, EA next year also.
820 Philip Dr, Ste A
Waukesha, WI 53186
(262)549-1700 I hope you don’t forget the WAA and chapter benefits. Please make a list of your ideas
firstname.lastname@example.org to improve your association and send to me.
Mark Burbey, CPA
900 S 10th St I hope you all have a great tax season.
Manitowoc, WI 54220
John M Arndt, CPA Thomas M. Adler, CPA, ATA, ATP
15050 W North Av WAA President
Brookfield, WI 53005
Mark Nelson, Sr
2581 S Kinnickinnic Av
Milwaukee, WI 53207
Byron Dopkins, WAA Executive Director
PO Box 356, River Falls, WI, 54022
715-425-0482 • 1-800-237-4080
THE WISCONSIN ACCOUNTANT pAGE 3
IRS Kicks Off 2011 Tax Season
WAA Benefits with Deadline Extended to April 18;
Seminars and Educational Forums Taxpayers Impacted by Recent Tax
Accreditation Breaks Can File Starting in Mid- to
Local Chapter Involvement
Late February Continued
Government Agency Liaison Continued from page 1
Monitor Legislation Who Must Wait to File
For most taxpayers, the 2011 tax filing season starts on schedule. However, tax
Insurance Programs law changes enacted by Congress and signed by President Obama in December
mean some people need to wait until mid- to late February to file their tax returns
Accountants Protection Plan
in order to give the IRS time to reprogram its processing systems. Some taxpayers –
including those who itemize deductions on Form 1040 Schedule A – will need to wait
to file. This includes taxpayers impacted by any of three tax provisions that expired
at the end of 2009 and were renewed by the Tax Relief, Unemployment Insurance
Reauthorization, and Job Creation Act Of 2010 enacted Dec. 17. Those who need to
wait to file include:
WAA Objectives • Taxpayers Claiming Itemized Deductions on Schedule A. Itemized deductions
To raise professional standards and include mortgage interest, charitable deductions, medical and dental expenses
as well as state and local taxes (add link to Schedule A). In addition, itemized
improve the practice of accountancy.
deductions include the state and local general sales tax deduction that was
also extended and which primarily benefits people living in areas without state
To strive for excellence in the and local income taxes. Because of late Congressional action to enact tax law
profession. changes, anyone who itemizes and files a Schedule A will need to wait to file until
mid- to late February.
To encourage accountants in a
continuing program of • Taxpayers Claiming the Higher Education Tuition and Fees Deduction. This
professional development. deduction for parents and students – covering up to $4,000 of tuition and fees
paid to a post-secondary institution – is claimed on Form 8917. However, the IRS
emphasized that there will be no delays for millions of parents and students who
To foster increased recognition
claim other education credits, including the American Opportunity Tax Credit
for the professional in the public, extended last month and the Lifetime Learning Credit.
private and educational sectors of
our state. • Taxpayers Claiming the Educator Expense Deduction. This deduction is for
kindergarten through grade 12 educators with out-of-pocket classroom expenses
To initiate legislative action and pro- of up to $250. The educator expense deduction is claimed on Form 1040 Line
vide government liaison between the 23 and Form 1040A Line 16.
accounting profession and
In addition to extending those tax deductions for 2010, the Tax Relief, Unemployment
Insurance Reauthorization, and Job Creation Act also extended those deductions for
2011 and a number of other tax deductions and credits for 2011 and 2012 such
To provide meetings and fellowship as the American Opportunity Tax Credit and the modified Child Tax Credit, which
for accountants. help families pay for college and other child-related expenses. The Act also provides
various job creation and investment incentives including 100 percent expensing and
To promote the highest standard of a two-percent payroll tax reduction for 2011. Those changes have no effect on the
ethical conduct among its member. 2011 filing season.
The IRS will announce a specific date in the near future when it can start processing
tax returns impacted by the recent tax law changes. In the interim, taxpayers affected
by thesetax law changes can start working on their tax returns, but they should not
submit their returns until IRS systems are ready to process the new tax law changes.
Additional information will be available at www.IRS.gov.
Continued on page 4
THE WISCONSIN ACCOUNTANT pAGE 4
Form 990 Filing IRS Kicks Off 2011 Tax Season
Requirement with Deadline Extended to April 18;
Increases to Taxpayers Impacted by Recent Tax
$50,000 Breaks Can File Starting in Mid- to
Submitted by Ashwaubenon Tax Professionals
Late February Continued
IRS has released Revenue Procedure 2011-15 Continued from page 3
which reminds taxpayers of the change in the
For taxpayers who must wait before filing, the delay affects both paper filers and
filing requirement for exempt organizations.
electronic filers. The IRS urges taxpayers to use e-file instead of paper tax forms to
minimize confusion over the recent tax law changes and ensure accurate tax returns.
In prior years the filing requirement for Form
Except for those facing a delay, the IRS will begin accepting e-file and Free File returns
990 for an organization exempt from federal
on Jan. 14. Additional details about e-file and Free File will be announced later this
income tax has been $25,000 of annual gross month.
receipts. As IRS has outlined in recent years,
this amount increases to $50,000 effective Many Ways to Get Assistance
for tax years beginning on or after January 1, The IRS is also continuing to focus on taxpayer service. Taxpayers with questions
2010. should check the IRS website at www.IRS.gov, call our toll-free number or visit a
taxpayer assistance center.
A copy of this Revenue Procedure can be
found on IRSs web site www.irs.gov or by going This is also the first filing season that tax packages will not be mailed to individuals
to www.irs.gov/pub/, clicking on irs-drop, and or businesses. There are still many options for taxpayers to get paper forms and
then on rp-11-15. We can also send you a pdf instructions if they need them. In recent years, fewer and fewer taxpayers received
copy attached to an email, upon request. these mailings. Last year, only 8 percent of individuals who filed tax returns received
tax packages in the mail. Taxpayers can still get any forms and instructions they need
online at www.IRS.gov, or they can visit local IRS offices or participating libraries and
In addition, individuals making $49,000 or less can use the Volunteer Income Tax
Assistance program for free tax preparation and, in many cases, free electronic filing.
Individuals age 60 and older can take advantage of free tax counseling and basic
income tax preparation through Tax Counseling for the Elderly.
IRS Free File provides options for free brand-name tax software or online fillable
forms plus free electronic filing. Everyone can use Free File to prepare a federal tax
return. Taxpayers who make $58,000 or less can choose from approximately 20
commercial software providers. There’s no income limit for Free File Fillable Forms,
the electronic version of IRS paper forms, which also includes free e-filing.
Check for a Refund
Once taxpayers file their federal return, they can track the status of their refunds
by using the “Where’s My Refund?” tool, located on the front page of www.IRS.gov.
Taxpayers can generally get information about their refunds 72 hours after the IRS
acknowledges receipt of their e-filed returns, or three to four weeks after mailing a
Taxpayers need to provide the following information from their tax returns: (1) Social
Security Number or Individual Taxpayer Identification Number, (2) filing status, and
(3) the exact whole dollar amount of your anticipated refund. If the U.S. Postal Service
returns the taxpayer’s refund to the IRS, the individual may be able to use “Where’s
My Refund?” to change the address the IRS has on file, online.
Also, taxpayers may complete a Form 8822, Change of Address, and send it to the
address shown on the form. They may download Form 8822 from www.IRS.gov or
order it by calling 800-TAX-FORM. Generally, taxpayers can file an online claim for
a replacement check if more than 28 days have passed since the IRS mailed their
THE WISCONSIN ACCOUNTANT pAGE 5
Deduction for One-Half of Self-
This newsletter was Employment Tax
Submitted by Wisconsin Department of Revenue
designed for the
WAA by: The federal Small Business Jobs Act of 2010 (Public Law 111-240, enacted
September 27, 2010) provides that the deduction for health insurance costs of
self-employed persons is taken into account when calculating the net earnings for
purposes of determining the self-employment tax. This provision applies for taxable
years beginning after December 31, 2009.
As of this date (December 13, 2010), Wisconsin has not adopted the provisions of
the Small Business Jobs Act.
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Federal Tax Treatment
The deduction for health insurance costs of self-employed persons reduces net
income when determining self-employment tax. This reduces the amount of self-
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employment tax. This reduced amount of self-employment tax is then used to
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determine the deduction for one-half of self-employment tax.
Example: The taxpayer has $50,000 of net profit from Schedule C and claims a
$4,000 self-employed health insurance deduction on line 29 of 2010 Form 1040. The
self-employment tax is $6,500 based on net earnings of $46,000 after subtracting
the $4,000. The deduction for one-half of self-employment tax is $3,250. (Amounts
Brochures Wisconsin Tax Treatment
Newsletters Because Wisconsin has not adopted the provisions of the Small Business Jobs Act
of 2010, the deduction for self-employed health insurance is not considered when
Direct mail determining the self-employment tax. This results in an increased deduction for one-
half of self-employment tax for Wisconsin. The taxpayer must file Wisconsin Schedule
I, Adjustments to Convert 2010 Federal Adjusted Gross Income and Itemized
Business cards Deductions to the Amounts Allowable for Wisconsin, to adjust for the difference in
the federal and Wisconsin deduction for one-half of self-employment tax.
Postcards Example: The facts are the same as in the federal example above. However, the
deduction for self-employed health insurance is not considered when determining
Letterhead the self-employment tax. The taxpayer should recompute Schedule SE for Wisconsin
without subtracting the amount of the self-employed health insurance deduction.
& MORE For Wisconsin purposes, the self-employment tax is $7,065 based on earnings of
$50,000. The Wisconsin deduction for one-half of self-employment tax is $3,533.
(Amounts are rounded.) The taxpayer must file Wisconsin Schedule I to adjust for
the difference between the federal and Wisconsin deduction for one-half of self-
employment tax ($283).
214 N Main St.
River Falls, WI 54022