2017 Tax Season Letter
March 3, 2017
Dear Clients & Friends:
Here it is already March and we are well into tax season. We are meeting with our business clients to get the information we need to complete Corporate and Partnership returns. Our individual clients have received their information and are starting to come in as well. In January, we mailed organizers to our individual clients. If you didn’t receive one but would like to, please call our office today.
Enclosed, please find the spring edition of our quarterly newsletter. The spring edition, released during tax season, contains quite a bit of beneficial information. On the cover page, you will find useful information about several education tax breaks for current college students and for those who graduated and are paying student loans. If you are currently attending college, you could be eligible for the American Opportunity Tax Credit, which is only available for the first four years of college or the Lifetime Learning Credit which has no limit on how many years it can be taken. Did you know that qualified student loan interest, up to $2,500, can be deducted depending on your income and filing status?
For our clients who are business owners looking for advice for retaining employees, Page 2 offers great tips to reduce employee turnover. Also for our business clients, the due dates to file corporate tax returns for calendar-year Corporations and Partnerships has shifted this year. Partnerships and S-Corporations must file by March 15th and C-Corporations have been given an additional month to file their tax returns, which are due on April 18th this year.
Page 3 of the quarterly newsletter discusses new foreign asset reporting requirements. If you hold assets in foreign accounts, you may need to file a FATCA Form 8938 (Statement of Specified Foreign Financial Assets). The timing of the annual filing disclosure has changed from June 30 to April 18, 2017 and failing to meet the filing requirement can be expensive.
Lastly, the back page of the newsletter discusses facts and changes regarding Individual Retirement Accounts (IRAs). Did you know you have until the tax return filing date to contribute for the prior year? That means you have until April 18th this year to contribute to your IRA and possibly reduce your taxable income for 2016.
The decrease in the cost of fuel caused the standard mileage rate for business use of vehicles to go down from 54 cents to 53.5 cents per mile in 2017. Also on the inside of the newsletter, you will find the 2017 tax numbers. Standard deductions, exemptions and maximum contributions will remain about the same as 2016.
As always, let us know of any home improvements you made. With the residential energy credit, you can claim up to 10% of qualified expenses subject to overall lifetime limits.
Please call our office for an appointment as soon as you receive all of your tax information. We try to use the first-in, first-out method when preparing returns, so the sooner you bring in all your information, the sooner we will be able to prepare your return and get it back to you. We are looking forward to meeting with you in the coming weeks and assisting you with your financial and tax preparation needs.
Thank you for continued patronage. As always, we welcome any feedback you may have on the services we offer and we also welcome any referrals you may have.
Starkey & Company, PA