In this week’s episode 26 , I discuss the Federal, State, and International News for the week. I submitted a session and was accepted to give a presentation at Podcamp Nashville called “From deep within the Tax Jungle. Preparing for State taxes in a digital age, ” To register for Podcamp Nashville go to http://www.podcampnashville.org/pcn13/
The tax in-depth discussion is on calculation state taxable income for State extensions.
In Federal News:
The Obama Administration has mention taxing and restricting IRAs for the wealthy. Is this the beginning of taxing or restricting IRAs and deductions?
Budget was back in the news with all new proposed tax increases.
In International news, I discuss the French tax news that the Budget Minister had a secret Swiss Account for the twenty years that was not reported to the French Government for tax purposes. Based on I discussed briefly the U.S. reporting rules on Foreign Bank Accounts over $10,000. I, also briefly discuss Cyprus and the Millionaire Laptop book.
In State Tax News:
Virginia is raising the sales and use tax beginning July 1st to 4.3%.
Tax Revenues are down in many States.
For the indepth tax discussion, I discuss State taxable income, extensions, and estimates.
While some States extensions and estimates are due March, other States are due April 15th.
To calculate State taxable income:
- Start with Federal Taxable Income.
- Add back Federal State income differences if the State does not follow Federal) to calculate state taxable income. The differences may include:
- Depreciation including Bonus
- State or local Taxes based on income (may include Franchise Taxes)
- Section 199 deductions
- Intercompany interest income or expenses
- Determine preapportioned income.
- If reporting and filing tax returns in several states, apportioned the income based on the States appointment factor which may include
Some States are beginning to use a single apportioned factor such as sales to apportion income.
- Apportioned the income.
- Deduct any State Net Operating Losses
- Determine the tax rate.
- Determine any payments that you have already made.
- If estimated tax is greater than estimated payments, then print a voucher or tax form and send a check.
If estimated tax is less than estimated payments, then determine whether the state accepts the Federal Extensions. Some States require an extension for and other States accept the Federal Extension. Determine whether your state(s) accept the Federal extension if you do not owe.
When you prepare the State return, send a copy of the State or Federal Extension (if the state accepts the Federal extension).
For estimates, determine the quarter and minimum payment requirements. Some states follow 25%, 50%, 75%, and 100% for first, second, third, and fourth quarters. Other states have their own requirements.
If you have a question or feedback about this podcast, please send me an email to email@example.com
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