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FAQ: Deductions | October 2012

Question: Can I deduct separate maintenance paid to my spouse or alimony paid to my former spouse?

Answer:

If you are separated or divorced, you may generally deduct payments of separate maintenance or alimony paid in cash (including check or money order payable on demand) to, or on behalf of, your spouse or former spouse.

 

Question: Am I eligible to claim both my job-related education expenses (minus 2% of AGI) and the Lifetime Learning Credit on my tax return?

Answer:

If you are eligible to deduct educational expenses and are also eligible for one of the education credits (the Lifetime Learning Credit or the American Opportunity Tax Credit), then it is possible to claim both. You cannot use the SAME educational expenses to claim both benefits (no “double benefit”).

  • You may choose to allocate some of your expenses to the deduction and others to the credit.
  • This can be desirable because a qualifying expense for one benefit may not be a qualifying expense for the other tax benefit. For example, the cost of course-related books ordinarily qualifies for the deduction, but not for the Lifetime Learning Credit. For tax years beginning in 2009 and 2010, course-related books may qualify for the American Opportunity Tax Credit.

 

 

Question: What types of work-related educational expenses are deductible?

Answer:

Deductible work-related educational expenses include:

  • Amounts spent for tuition, books, supplies, laboratory fees and similar items.
  • Transportation and travel expenses to attend qualified educational activities may also be deductible.

 

 

Question: Is interest on a home equity line of credit deductible as a second mortgage?

Answer:

You may deduct home equity debt interest, as an itemized deduction, if all the following conditions apply:

  • You are legally liable to pay the interest
  • You pay the interest in the tax year
  • The debt is secured with your home
  • The home equity debt is limited to the fair market value of the home reduced by home acquisition debt, up to a total of $100,000.
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Upcoming Tax Deadlines | October 2012

October

Mon1File Form 730 and pay tax on wagers accepted during August.
Mon1File Form 2290 and pay the tax for vehicles first used during August.
Wed3Deposit payroll tax for payments on Sep 26-28 if the semiweekly deposit rule applies.
Fri5Deposit payroll tax for payments on Sep 29 – Oct 2 if the semiweekly deposit rule applies.
Wed10
 Employers: Employees are required to report to you tips of $20 or more earned during September.
Thu11 Deposit payroll tax for payments on Oct 3-5 if the semiweekly deposit rule applies.
Fri12 Deposit payroll tax for payments on Oct 6-9 if the semiweekly deposit rule applies.
Mon15 Deposit payroll tax for Sep if the monthly deposit rule applies.
Mon15
 Individuals: File 2011 Form 1040, 1040A, or 1040EZ if you timely requested a 6-month extension.
Mon15
 Electing Large Partnerships: File 2011 Form 1065 if you timely requested a 6-month extension.
Mon15 File 2011 Form 5500 if you timely requested an extension on Form 5558.
Wed17 Deposit payroll tax for payments on Oct 10-12 if the semiweekly deposit rule applies.
Fri19 Deposit payroll tax for payments on Oct 13-16 if the semiweekly deposit rule applies.
Wed24 Deposit payroll tax for payments on Oct 17-19 if the semiweekly deposit rule applies.
Fri26 Deposit payroll tax for payments on Oct 20-23 if the semiweekly deposit rule applies.
Wed31 Deposit payroll tax for payments on Oct 24-26 if the semiweekly deposit rule applies.
Wed31 File Form 720 for the third quarter of 2012.
Wed 31 File Form 730 and pay tax on wagers accepted during September.
Wed31 File Form 2290 and pay the tax for vehicles first used during September.
Wed 31 File Form 941 for the third quarter of 2012.
Wed 31 Deposit FUTA owed through Sep if more than $500.

 

November

Fri2Deposit payroll tax for payments on Oct 27-30 if the semiweekly deposit rule applies.
Wed 7Deposit payroll tax for payments on Oct 31 – Nov 2 if the semiweekly deposit rule applies.
Fri9Deposit payroll tax for payments on Nov 3-6 if the semiweekly deposit rule applies.
Tue13 
Employers: Employees are required to report to you tips of $20 or more earned during October.
Tue13File Form 941 for the third quarter of 2012 if you timely deposited all required payments.
Thu15Deposit payroll tax for Oct if the monthly rule applies.
Thu15Deposit payroll tax for payments on Nov 7-9 if the semiweekly deposit rule applies.
Fri16Deposit payroll tax for payments on Nov 10-13 if the semiweekly deposit rule applies.
Wed21Deposit payroll tax for payments on Nov 14-16 if the semiweekly deposit rule applies.
Mon26Deposit payroll tax for payments on Nov 17-20 f the semiweekly deposit rule applies.
Wed28Deposit payroll tax for payments on Nov 21-23 if the semiweekly deposit rule applies.
Fri30Deposit payroll tax for payments on Nov 24-27 if the semiweekly deposit rule applies.
Fri30 File Form 730 and pay tax on wagers accepted during October.
Fri30File Form 2290 and pay the tax for vehicles first used during October.

 

December

Wed5Deposit payroll tax for payments on Nov 28-30 if the semiweekly deposit rule applies.
Fri7Deposit payroll tax for payments on Dec 1-4 if the semiweekly deposit rule applies.
Mon10Employers: Employees are required to report to you tips of $20 or more earned during November.
Wed12Deposit payroll tax for payments on Dec 5-7 if the semiweekly deposit rule applies.
Fri14Deposit payroll tax for payments on Dec 8-11 if the semiweekly deposit rule applies.
Mon17Deposit payroll tax for Nov if the monthly deposit rule applies.
Mon17Corporations: Deposit the fourth installment of your estimated tax for 2012.
Wed19Deposit payroll tax for payments on Dec 12-14 if the semiweekly deposit rule applies.
Fri21Deposit payroll tax for payments on Dec 15-18 if the semiweekly deposit rule applies.
Thu27Deposit payroll tax for payments on Dec 19-21 if the semiweekly deposit rule applies.
Fri28  Deposit payroll tax for payments on Dec 22-25 if the semiweekly deposit rule applies.
Mon31File Form 730 and pay tax on wagers accepted during November.
Mon31File Form 2290 and pay the tax for vehicles first used during November.
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Upcoming Tax Deadlines October 2011

Monday, October 31, 2011

Employers – Social security, Medicare, and withheld income tax. File Form 941 for the third quarter of 2011. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter in full and on time, you have until November 10 to file the return.

Certain Small Employers – Deposit any undeposited tax if your tax liability is $2,500 or more for 2011 but less than $2,500 for the third quarter.

Employers – Federal unemployment tax.Deposit the tax owed through September if more than $500.

Tuesday, November 1, 2011

Employers – Income tax withholding. Ask employees whose withholding allowances will be different in 2012 to fill out a new Form W-4 or Formulario W-4(SP). The 2012 revision of Form W-4 will be available on the IRS website by mid-December.

Thursday, November 10, 2011

Employees who work for tips – If you received $20 or more in tips during October, report them to your employer. You can use Form 4070.

Employers – Social security, Medicare, and withheld in come tax. File Form 941 for the third quarter of 2011. This due date applies only if you deposited the tax for the quarter in full and on time.

Tuesday, November 15, 2011

Employers – Social security, Medicare, and withheld income tax.If the monthly deposit rule applies, deposit the tax for payments in October.

Employers – Nonpayroll withholding.If the monthly deposit rule applies, deposit the tax for payments in October.

Monday, December 12, 2011

Employees who work for tips – If you received $20 or more in tips during November report them to your employer. You can use Form 4070.

Thursday, December 15, 2011

Corporations – Deposit the fourth installment of estimated income tax for 2011. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.

Employers – Social security, Medicare, and withheld income tax.If the monthly deposit rule applies, deposit the tax for payments in November.

Employers – Nonpayroll withholding.If the monthly deposit rule applies, deposit the tax for payments in November.

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