Congress is Driving Us Crazy
There are a couple new tax and financial planning issues affecting our clients for the 2009 tax season, so be aware:
1. Every disaster needs a new tax law…apparently.
We, like the rest of the world, were saddened by the tragedy of the Haiti earthquake, and, like so many, were inspired to donate what we could. As accountants, however, we also realized this created a new issue for the upcoming tax season. They do make tax planning a challenge. For an analysis of deducting Haiti donations made in 2010 on your 2009 tax return, look at page 3 of our newsletter. This is hot off the government presses and doesn’t apply to any of the other worthwhile causes out there.
2. Another developing issue: if you’ve worked diligently with your attorney to develop an estate plan, congratulations, that plan may now be useless — at least for the time being.
As of January 1, 2010 the estate tax has been temporarily repealed. Don’t worry, though; it comes back as of January 1, 2011. Congress may extend the tax retroactively, but who knows. You may want to contact your attorney to see if a fix to your plan is warranted.
There may be more retroactive tax laws to follow, so stay tuned!
On a more positive note, wouldn’t it be nice if the Kansas Legislature actually considered and passed a repeal of the Kansas Income Tax? I understand that other taxes would be expanded to cover the shortfall, but I am growing tired of Kansans moving to Texas, Florida or Nevada to avoid the Kansas Income Tax. Even boring accountants can dream.