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					   WHAT'S NEW IN 2011?

What we are going to cover:

 2010 Tax Relief Act - New tax
  provisions in 2011
 Items affecting tax preparation in
  2011 and beyond
 Training and Certification

             DISTRICT 5 TRAINING 2011   1
    TAX RATES CONTINUED*

 The 2010 Tax Relief Act:
   Extends all individual rates at 10, 15, 25,
    28, 33 and 35 percent
   Continues for two years – through
    December 31, 2012



* Affects 2011 and 2012 tax returns


                DISTRICT 5 TRAINING 2011      2
        PAYROLL TAX CUT

 The 2010 Tax Relief Act reduces the
  employee-share of Social Security taxes
  from 6.2% percent to 4.2%
 The change is for wages earned in calendar
  year 2011 up to the taxable wage base of
  $106,800
 Self-employed individuals will pay 10.4%
  (down from 12.4%)on self-employment
  income up to the threshold

               DISTRICT 5 TRAINING 2011    3
  QUALIFIED CAPITAL GAINS
     AND DIVIDENDS*

 Qualified capital gains and dividends
  currently are taxed at a maximum rate of
  15 percent (zero percent for taxpayers in
  the 10 and 15 percent income tax brackets)
 The 2010 Tax Relief Act continues for two
  years – until December 31, 2012

* Affects 2011 and 2012 tax returns


               DISTRICT 5 TRAINING 2011    4
  Schedule D and Form 8949
 Schedule D for 2011 – has new reporting
  lines using Form 8949 (New in 2011)
 Form 8949 has three boxes that need to be
  completed for each taxpayer
   Box A – Cost basis shown on 1099-B
   Box B – Cost basis not shown on 1099-B
   Box C – No 1099-B received




              DISTRICT 5 TRAINING 2011    5
SCH D & FORM 8949, cont’d
 For each asset sold, the 1099 will have an
  A/B/C designator
 Assets can no longer be entered on
  Schedule D
 All assets information goes on Forms 8949
 Page 1 is for short term; Page 2 is for long
  term




                DISTRICT 5 TRAINING 2011         6
SCH D & FORM 8949, cont’d
                                           Tab 2


 In TaxWise, Capital Gain or Loss Transactions
  Worksheet (Cap Gain Wkt) will load 8949s and
  put assets on appropriate pages
 Long Term/Short Term Capital Gains/Losses
  Wkts will no longer be in Forms list
 A/B/C designators will be located on Cap Gain
  Wkt under 1099 column
 Column (b) is code for adjustments to gain/loss,
  wash sales, exclusion of gain on main home, etc
 Column (g) is the amount of the adjustment

                DISTRICT 5 TRAINING 2011        7
SCH D & FORM 8949, cont’d




 Column (b) is for gain/loss adjustment codes;
  see F1 help and Form 8949 instructions
 Column (g) is for amount of adjustment

                DISTRICT 5 TRAINING 2011     8
                 A

                 F


                 D



                 B



                 C

                 M
DISTRICT 5 TRAINING 2011   9
CAPITAL GAINS ENTRY - 2011
TAXWISE




        DISTRICT 5 TRAINING 2011   10
Capital Gains Transactions – 2011




           DISTRICT 5 TRAINING 2011   11
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DISTRICT 5 TRAINING 2011   15
1040 – Page 1




         DISTRICT 5 TRAINING 2011   16
           Standard
     Deduction/Exemptions
 Standard deduction
   MFJ - $11,600 (up $200)
   Head of Household and $8,500 (up
    $100)
   Single/MFS - $5,800 (up $100)
 Personal/Dependency Exemption
   $3,700 (up $50)



              DISTRICT 5 TRAINING 2011   17
         CHILD TAX CREDIT


 The 2010 Tax Relief Act extends the $1,000
  child tax credit for two years, through
  December 31, 2012.
 The qualifying child must be under age 17 at
  the close of the year and satisfy relationship,
  residency, support, citizenship, and
  dependent tests.


                DISTRICT 5 TRAINING 2011       18
 EITC AND DEPENDENT CARE

 Extends the enhanced EITC for two years
  (i.e., three or more qualifying children)
 Extends the enhanced dependent care
  credit and eligible expenses for two years
   From $2,400 to $3,000 and $4,800 to
     $6,000 for more than one qualifying
     individual
   Maximum credit from 30% to 35 % of
     qualifying expenses

                DISTRICT 5 TRAINING 2011       19
                    EITC
 Earned Income and adjusted gross income
  (AGI) must each be less than:
   $43,998 ($49,078 married filing jointly)
    with three or more qualifying children
   $40,964 ($46,044 married filing jointly)
    with two qualifying children
   $36,052 ($41,132 married filing jointly)
    with one qualifying child
   $13,660 ($18,740 married filing jointly)
    with no qualifying children
               DISTRICT 5 TRAINING 2011        20
         EITC (continued)
 Tax Year 2011 maximum credit:
   $5,751 - three or more qualifying
     children
   $5,112 - two qualifying children
   $3,094 - one qualifying child
   $464 - no qualifying children
 Investment income must be $3,150 or less
  for the year.
 Advance EITC no longer exists.

              DISTRICT 5 TRAINING 2011       21
DISTRICT 5 TRAINING 2011   22
             AMT PATCH*

 The 2010 Tax Relief Act increases the
  exemption amounts for 2010 and 2011:
   $47,450 for individual taxpayers
   $72,450 for married taxpayers filing
    jointly and surviving spouses
   $36,225 for married couples filing
    separately.

* Affects 2011 and 2012 tax returns

               DISTRICT 5 TRAINING 2011    23
     Standard Mileage Rates

 Beginning on Jan. 1, 2011, the standard
  mileage rates for the use of a car (also
  vans, pickups or panel trucks) will be:
   51 cents/mile for business miles (55.5
    cents effective 07/01/2011)
   19 cents/ mile driven for medical or
    moving purposes
   14 cents per mile driven in service of
    charitable organizations


               DISTRICT 5 TRAINING 2011      24
LTC Premiums deduction

 For 2011, the maximum amount of
  qualified long-term care premiums
  includible as medical expenses has
  increased on Schedule A (Form 1040)
  Itemized Deductions (per person)
   $340 - Age 40 or under
   $640 - Age 41 to 50
   $1,270 - Age 51 to 60
   $3,390 - Age 61 to 70
   $4,240 - Age 71 and over
              DISTRICT 5 TRAINING 2011   25
              EXTENDERS

 Qualified Charitable Distributions from certain
  individual retirement plans for charitable
  purposes (thru 2011)
 Deduction for educator expenses in figuring
  AGI (thru 2011)
 Tuition and fees deduction in figuring AGI
  (thru 2011)
 Itemized deduction for state and local general
  sales taxes (thru 2011)

                DISTRICT 5 TRAINING 2011      26
              EXTENDERS
              (continued)
 American Oppor Tax Credit (thru 2012)
 Child tax credit of $1,000 and the earned
  income threshold of $3,000 for the child tax
  credit (thru 2012)
 Private mortgage insurance deduction
  (through 2011)
 Non-business energy property credit (with
  some limitations) (thru 2011)
 EITC increased credit for three or more
  qualifying children (thru 2012)
               DISTRICT 5 TRAINING 2011      27
Non-business Energy Property
           Credit
 This credit has been extended for 1 year
  with a reduced rate of 10%.
 Amounts provided by subsidized federal,
  state, or local energy financing do not
  qualify for the credit.
 The energy-efficiency standards for qualified
  natural gas, propane, or oil furnaces, or hot
  water boilers have been increased.



               DISTRICT 5 TRAINING 2011      28
Non-business Energy Property
     Credit (continued)
 For 2011, the credit is limited as follows.
   Total combined credit limit of $500 for all tax years
    after 2005 (Form 5695, Part I).
   Combined credit limit of $200 for windows for all the
    amount of your tax years after 2005.
   Maximum credit for residential energy property costs:
     $50 for any advanced main air circulating fan;
     $150 for any qualified natural gas, propane, or oil
       furnace, or hot water boiler;
     $300 for any item of energy-efficient building
       property.


                  DISTRICT 5 TRAINING 2011             29
Residential Energy Credits




         DISTRICT 5 TRAINING 2011   30
              IRS CHANGES
              FOR VITA-TCE
 Lump-sum social security payments are included
  as Basic competency
   Last year, only current year taxability in
     scope, but use of numbers from previous
     year returns in scope this year
 No second copy of Form 8879 and income
  attachments, i.e. W2s’, 1099s’, etc retained at
  the site or by the ERO
   SPEC no longer requires copy for storage; taxpayer
    still signs single copy prior to efile submission and
    retains the copy with their tax records

                   DISTRICT 5 TRAINING 2011                 31
NEW PREPARER USE FORM
 Dedicated to Preparer’s Use Fields
 Prep Use Fields no longer on Main Info
  Sheet
 Prep Use Fields increase from 15 to 25
   Standardized to 15-character
    alphanumeric
   Enter up to 25 questions in column A




               DISTRICT 5 TRAINING 2011    32
 PREPARER USE FORM, cont’d

 All Preparer Use Field entries will be stored
  for reporting purposes (not the question)
 Accessible via the report server
 Taxpayer Reminder Field will be added
   Enter information you need to convey to
     preparer for following year
   Will automatically display when return is
     started in TY 2012 (January 2013)



                DISTRICT 5 TRAINING 2011          33
DISTRICT 5 TRAINING 2011   34
Intake/Interview & Quality
      Review Sheet

       Form 13614-C




        DISTRICT 5 TRAINING 2011   35
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DISTRICT 5 TRAINING 2011   37
           RECORD KEEPING
 Beginning 2011 tax filing season, we no longer
  will retain and send to the IRS:
   A signed copy of Form 8879 and income
     statements (W2, W2G and 1099s’)
 AARP will no longer permit retaining a copy
  with supporting documents at the site except
  for use with Form 8453 mailing
 This will require sites to revise their e-filing
  procedures

                 DISTRICT 5 TRAINING 2011      38
       Tracking of Returns
           for E-filing
 Each site will track returns to make sure
  the ERO knows which returns are ready
  for e-filing
 Returns must be transmitted and
  accepted in a timely manner.
 Each site must adopt a method to
  protect TP data and privacy



              DISTRICT 5 TRAINING 2011    39
  Taxpayer Data and Privacy
           Policy


 The Site or ERO will not keep any forms
  or documents with a taxpayer identity
  and/or SSN that is not mandated by the
  IRS or a State. ie. Form 8453 if used for
  mailing




              DISTRICT 5 TRAINING 2011   40
      Site sign-in/log sheet
   In addition to using Return Stage in TaxWise;
   The site will record on the site sign-in/log
    sheet the status of the return:
     Ready to e-file;
     Waiting for signature of Form 8879;
     Return will be paper filed;
     Waiting for Taxpayer documents
     Question only – no return prepared




                DISTRICT 5 TRAINING 2011        41
Modified TaxAide Site Sign-In
           Sheet




         DISTRICT 5 TRAINING 2011   42
Activity Report for Reporting




          DISTRICT 5 TRAINING 2011   43
Activity Report for Tracking E-File
      Returns - Transmitted




           DISTRICT 5 TRAINING 2011   44
Activity Report for Tracking E-
     Files - Acknowledged




         DISTRICT 5 TRAINING 2011   45
Line Added on AZ140 for
     Unpaid Use Tax




       DISTRICT 5 TRAINING 2011   46
NTTC/NTC ERO Training 2011   47
DISTRICT 5 TRAINING 2011   48
DISTRICT 5 TRAINING 2011   49
 SUPPORTING DOCUMENTATION
 Pub 4012 Volunteer Resource Guide
 Pub 4491 (hard copy or CD) Training Guide
 Pub 4491W Comprehensive Problems &
  Exercises
 Pub 17 Your Federal Income Tax Guide
 Pub 6744 Volunteer Test/Retest




               DISTRICT 5 TRAINING 2011       50
TRAINING & CERTIFICATION

 Counselors – six (6) steps
 Noncounselors – four (4) steps
 All must pass IRS Standards of Conduct test
  with 80% accuracy
 All must sign Volunteer Standards of Conduct
 All Counselors must pass IRS test at 80%,
  Standards of Conduct, Basic, Intermediate &
  Advanced levels, using Pub 6744 or IRS Link
  & Learn test system

               DISTRICT 5 TRAINING 2011     51
DISTRICT 5 TRAINING 2011   52
   Volunteer Training Process
For Volunteers Not Providing Tax
           Assistance




          DISTRICT 5 TRAINING 2011   53
Standards of Conduct Training

 Training module in Pub 6744 and Link and
  Learn
 Includes 6 Standards of Conduct
 Includes 10 Quality Site Requirements
 All volunteers must answer 4 of 5 questions
  correctly




               DISTRICT 5 TRAINING 2011     54
Volunteer
Standards of Conduct Agreement –
VITA/TCE Programs


            Form 13615




           DISTRICT 5 TRAINING 2011   55
       Training on TaxWise

 Train on TW11 2011 returns
 TWO EROs can setup training users for both
  TW10 and TW11
   TW11 users will carryover to TW11
 Desktop EROs can setup TWO training
  users for both TW10 and TW11
   Training TWO will be deactived 2/12
 Procedure available on AZ TaxAide

              DISTRICT 5 TRAINING 2011     56
        Take the Test On L&L
 All counselor can certify on L&L
 Problems can be prepared on Practice Lab,
  TWO or desktop
 Form 13615 Volunteer Agreement can be
  printed when test completed
 Biggest Advantage – Instructor don’t have to
  grade test
 See document [Take the Test Using Link &
  Learn (11/14)


                DISTRICT 5 TRAINING 2011     57
Counselor Certification Process
 Preferred: Take test on L&L, print out
  results (printed on form 13615), sign and
  provide to instructor or LC. Instructor or LC
  reviews 4 exercises completed by counselor
  and resolves any errors
 Can take test manually using Pub 6744 and
  provide answer sheet to instructor or LC for
  grading.




                DISTRICT 5 TRAINING 2011      58
Counselor Certification Continued
 Lead instructor should collect Form 13615 and
  inform LC of certified counselors
 All Form 13615s must be signed by instructor & a
  copy submitted to Sandy Liska either by mail, fax
  or email.
            8103 E Southern Ave Lot 73
            Mesa AZ 85029-3508
            480-380-1505
            aarpsdliska@gmail.com




                  DISTRICT 5 TRAINING 2011            59
Counselor Certification Continued
 If LC grades the test and has the counselor sign Form
  13615, the form should be signed by the LC, a copy
  sent to Sandy and the instructor should be informed.
 The Form 13615s should be retained at the local level
  until the end of the season
 Sandy will provide the list of certified counselors to
  the IRS




                  DISTRICT 5 TRAINING 2011           60
 Recommended Exercises
 Baylor – Military retiree, wife has died, caring for
  grandchild, div, pension, SS, and itemized deductions
 Fleming – Divorced woman, 2 kids, INT, IRA, pension,
  self employment, W-2, EITC
 Sterling – Retired couple, INT, DIV, stock sale, pension
  and SS
 Kent Comprehensive – Most everything except EITC.
  Line by Line answers




                    DISTRICT 5 TRAINING 2011           61
Other Training
 District must decide approach to train ERO’s.
 Reference ERO Presentation on Extranet
 As a minimum, a mentor (experience ERO) should
  be assigned to any new ERO
 Client Facilitator and any other volunteer must pass
  Standards of Conduct test
 Reference Client Facilitator training on the Extranet




                  DISTRICT 5 TRAINING 2011            62
    Reference Material on Extranet
   2011 Training Guide
   Power Point Training Slides
   Client Facilitator Training
   ERO Training
   Volunteer Standards of Conduct
   Volunteer Standards of Professionism
   Volunteer Certification Process
   Alternate Training Options
   Taxpayer Information and Responsibilities
   Volunteer Portal - Overview




                     DISTRICT 5 TRAINING 2011   63
     Reference Material on AZ Web
                 Site
   1099 SSA Lump Sum Payment
   Arizona Return Requirements
   Duck Book TWD & TWO
   Flow Chart Dependents/Exemptions
   HAS Training
   Sch C Training
   Test Using L&L
   Use Form D19597 to Track efiles
   Volunteer Certification Process
   P4961 Volunteer Stds Of Conduct Training




                    DISTRICT 5 TRAINING 2011   64
   AARP Tax-Aide Volunteer Portal

  A web-based and centralized access
  point that provides a single and secure
  access to All AARP Tax-Aide Information,
  Applications, Databases and Reporting
• Accessibility based on volunteer title and other
  requirements
• Simplification and consistent presentation of the
         tools and interfaces and all for data
  forms,Training Materials on the Portal used applications entry,
  search and reportingthe Extranet Training Tab
             can be found on
  http://assets.aarp.org/www.aarp.org_/taxaide/www.aarp.org/sk/taxaide/training.html

                             2011 Regional Meetings – St Louis                           65
                              DISTRICT 5 TRAINING 2011                                 65
    Future Portal Application
    Volunteer ShareNet (Formerly
    Extranet)
                                       Volunteer
                                      ShareNet in
                                        PORTAL




        EXTRAN
•   MoveET
        Extranet contents currently open to the public and
  maintained by AARP IT to secured and easy to use interface
  to be called “Volunteer ShareNet”
• Contents can be updated by Tax Aide staff at any time
• Access to the contents is determined by the user’s volunteer
  positions           2011 Regional Meetings – St Louis       66
                                                             66
• Systems maintainedDISTRICT 5 TRAINING 2011
                        in parallel during transition
Sample Volunteer ShareNet Screen




          2011 Regional Meetings – St Louis   67
              DISTRICT 5 TRAINING 2011             67
Portal Registration Roll Out



 Portal registration requires all AARP
  Foundation Tax-Aide Volunteers to have a
  unique email address.
 E-mail address may not be shared with
  another volunteer, AARP member or AARP.
  org registered user.
 ADS and National Office will assist in case of
  a conflict with E-mail addresses.


                 DISTRICT 5 TRAINING 2011          68
Portal Pre-Registeration


 Volunteers who are not already registered by
  the listed dates below will be pre-registered
  by the National Office using their existing
  VMIS Tax-Aide E-mail address as the Login
  ID.
   All Leaders – 12/31/11
   All Existing Non-Leaders – 1/15/12
   All New & Returning Volunteer – 2/15/12
 Volunteers will be provided with a Password
  by E-mail upon registration.
                DISTRICT 5 TRAINING 2011        69
That’s All Folks!

            Questions??




          DISTRICT 5 TRAINING 2011   70

				
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