- A review course on education tax credits
- Unclaimed property can be a business issue
- Watch out for special rules when making a Roth conversion
- Some business meals get a full deduction
- DB(k) retirement plans are new this year
- Pay yourself reasonable wages
- The kiddie tax: A basic review
- Follow IRA withdrawal rules
- Homebuyer tax credit extension
- Collectibles face special tax rules
- Rental property tax rules are complicated
- Payroll tax update
- Don't overlook the Roth five-year holding requirement
- Can you qualify for the small business health insurance credit?
- Military tax breaks are available
- Do you need to file an FBAR?
- Roth IRA conversion: Act now, pay later?
- Start your 2010 planning with your 2009 tax return
- Don't ignore employer penalty notices
- The HIRE Act offers tax breaks for hiring
- Direct deposit: Should you buy savings bonds?
- The Patient Protection and Affordable Care Act reforms health care
- Can you take a home office deduction?
- Deducting interest expense: What you need to know
- Did you receive Form 1099-C?
- Missing a W-2?
- Who has to file an income tax return?
- New law allows early deduction for Haiti relief donations
- The dependency exemption: What you need to know
- What's your status?
- Payroll - A 2010 employer update
- Review payroll reporting for 2009
- What to expect on your 2009 return
- Check these vehicle tax breaks for 2009
- Know the rules for backup withholding
- Tax issues come with gifting stock
- Hiring seasonal employees? What you need to know
- Don't get tripped up by a wash sale
- New law includes two important tax changes
- Two IRA tax breaks are scheduled to expire soon
- Take a tax deduction for worthless stock
- Withdrawals from your SIMPLE IRA may not be so simple
- Savings bonds can help pay for college
- Tax tips for first-time employers
- First-time homebuyer credit to expire November 30
- Closing your business has tax implications
- You need basis to deduct an S corporation loss
- Unemployed? Pay health premiums from your health savings account
- Some IRA terms you should know
- Employee or independent contractor? Don't misclassify workers
- Take a penalty-free IRA withdrawal for medical expenses
- Your business vehicle expenses are deductible
- Plan for the phase-out of tax breaks
- Your business could benefit from the extended net operating loss carryback
- When is income taxable, and when is it not
- IRS has a new procedure for correcting payroll returns
- Capture tax breaks when you refinance
- Prepare now for a possible disaster
- Tax law changes could affect your 529 plan
- Two reasons to review tax payments
- The COBRA credit: What employers must know
- Don't waste your tax refund
- A new vehicle could give you a new tax break
- Check out the "making work pay" credit
- Don't overlook a theft loss deduction
- Who owes self-employment tax?
- The Internal Revenue Service and Treasury Department Release Additional FBAR Guidance
- HIRE Act
- Health Care Updates
News
Follow IRA withdrawal rules
"You put your money in, and you take your money out." Unfortunately, the rules for taking withdrawals from your IRA are not as simple as those for performing the classic children's dance.
Here are three general guidelines.
- Early withdrawals. You'll pay regular income tax as well as a 10% penalty on early withdrawals from your traditional IRA unless an exception applies. Early withdrawals are those you take when you're under age 59½.
Exceptions that let you avoid the penalty include amounts you withdraw to use for the following:
- certain educational or medical expenses
- medical insurance when you're unemployed
- building, buying or rebuilding your first home
You may also qualify for an exception to the early withdrawal penalty if you're a military reservist, or when you inherit an IRA, take nontaxable distributions, or roll over eligible amounts within 60 days of the withdrawal.
- Required minimum distributions. For 2010, you're once again required to take distributions from your traditional IRA when you reach age 70½. The penalty for withdrawing less than the required amount is 50% of the shortage.
The required minimum distribution rules also apply when you inherit a traditional or a Roth IRA.
- Excess contributions. When you deposit more than the allowable maximum contribution into your IRA, you generally need to withdraw the excess along with any earnings by the due date of your tax return. Otherwise you may owe a 6% penalty, which can be assessed each year for as long as you leave the extra amount in your IRA.
The maximum IRA contribution limit for 2010 is $5,000 (plus an extra $1,000 if you're over age 50) or your earned income, whichever is less.
For more information, contact Ross Rizzo at 212-404-5528, rrizzo@sb-cpa.com.
"Tax Tips" are published weekly to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our office.
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