I’m not an expert in US Tax Law, but thankfully my blogging partner at TOTO, Connor is. If you file in the US, for more information about how you can rock your taxes be sure to visit Tax On Tax Off
It’s Tax Season in the US!
Form 1040, which is the most comprehensive income tax return that can be used for 2011, has a number of changes from the prior year.
The 5 key changes you need to know for filing your 2011 income taxes
Schedule D is revised
Rather than listing capital gain and loss transactions on Schedule D, with additional entries on Schedule D-1, there is a new form-Form 8949-for listing short-term and long-term capital gain and loss transactions. The totals are then transferred to Schedule D, which now acts as merely a summary.
New Form 8938
U.S. citizens and residents with certain foreign assets must now complete this new form, attached to Form 1040. Filling this in may be required in addition to the annual reporting of foreign accounts on TD 90-22.1 (which is filed with the Treasury each June).
Self-employment tax is reduced
Due to the payroll tax cut, self-employed individuals have a 2-percentage-point reduction in the employee portion of Social Security taxes. This reduction is reflected in Schedule SE of Form 1040. However, self-employed individuals continue to deduct the full employer portion of self-employment tax as an adjustment to gross income on page 1 of Form 1040.
Increased AMT exemption on Form 6251
The alternative minimum tax (AMT) exemption amount has increased in 2011 to $48,450 for single filers, $74,450 for married filing jointly or a qualifying widow(er), and $37,225 for married filing separately.
Schedules L and M is no longer used
Schedules you may have used last year are no longer needed on the Form 1040 for 2011. Schedule L, which was used for additional standard deduction amounts, and Schedule M, for the making work pay credit, are now obsolete because the tax breaks they applied to have expired.
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