Federal Tax UPDATES TO THE MODULE

The filing deadline is April 17, 2012 instead of April 15th because April 15th is a Sunday and April 16 is the Emancipation Day holiday in Washington, DC.

The following forms have been eliminated this tax year:

-Schedule L (Standard Deductions for Certain Filers). Information on standard deductions can now be found on the 1040 form and its instructions.
-Schedule M (Making Work Pay Credit). This tax credit is not available for tax year 2011.

Standard deduction amounts increased to the following figures:

-Single or Married Filing Separately = $5,800

- Married Filing Jointly or Qualifying Widower = $11,600

- Head of Household = $8,500

- Additional amounts for taxpayers who are blind OR age 65 or older increased, and are calculated based on a new worksheet found in the 1040 instructions.

- Personal and dependency exemption amounts remained at $3,700 per exemption

Earned Income Thresholds increased to the following figures

-$43,998 ($49,078 married filing jointly) with three or more qualifying children

-$40,964 ($46,044 married filing jointly) with two or more qualifying children

-$36,052 ($41,132 married filing jointly) with one qualifying child

-$13,660 ($18,740 married filing jointly) with no qualifying children

-The total of all interest, dividend, and capital gain income must be $3,150 or less regardless of whether the taxpayers have a qualifying child or not

Maximum Credit Amount

-$5,751 with three or more qualifying children

-$5,112 with two or more qualifying children

-$3,094 with one qualifying child

-$464 with no qualifying children

Advanced Earned Income Payment

Starting in 2011, individuals can no longer apply for an Earned Income Credit Advanced Payment (Form W-5). Prior to 2011, individuals who expected to receive the Earned Income Credit on their tax return could file Form W-5 with their employer. This allowed the employees to receive this credit in advance with their pay.

The standard mileage rates, which are used to calculate itemized deductions, for use of the taxpayers’ car for the following reasons have changed:

Business – 51 cents per mile (55 and a half after June 30, 2011)

Medical – 19 cents per mile (23 and a half after June 30, 2011)

In addition, starting in 2011 you may use the business standard mileage rate for a vehicle used for hire, such as a taxicab.

The First Time Homebuyer Credit:

To claim the first-time homebuyer credit for 2011, you (or your spouse if married) must have been a member of the uniformed services or Foreign Service or an employee of the intelligence community on qualified extended duty outside the US for at least 90 days during the period beginning after Dec 31, 2008 and ending before May 1, 2010.

INDIANA

1. A $1000 deduction is now available for education expenditures of families with a child enrolled in private school or home-schooled
2. Some items that are deducted for Federal must be added back to income when determining income for the purpose of paying taxes Indiana.

There are seven new "add-backs" to Indiana taxes for 2011.

The amount of the following federal deductions must be added back to determine income in Indiana:
-Educator Expenses - Taxpayer is an educator and claimed a deduction for expenses related to this job
-IRA Charitable Distributions – Taxpayer donated money to a charity with funds from an IRA
-Qualified Transportation Fringe Benefits – Taxpayer received transportation benefits from an employer
-Student Loan Interest – Taxpayer received an additional student loan interest deduction from Tax Relief, Unemployment Insurance
-Reauthorization, and Job Creation Act of 2010 – Taxpayer received any one of the deductions under this act
-Tuition and Fees - Taxpayer received a deduction for qualified tuition and related expenses

NORTH CAROLINA

1. Taxpayers in North Carolina used to have to pay a surtax (additional money) if they owed a certain amount of taxes. There is no longer an income surtax in 2011.

2. There is a new deduction for children with disabilities who are home-schooled or attend private school or public school where tuition is charged. The deduction is available up to a maximum of $3000 per semester per eligible child

OHIO

1. Personal and dependent exemptions are multiplied by $1650
(in 2010, the multiplying factor was $1600)

2. If OH taxable income is $10,000 or less, a credit of $88 is given.
(in 2010, the credit was $93)

3. There is a 4% reduction in Ohio’s income tax rate. This is the final phase of a 2005 commitment to cut income tax rates a total of 21%

4. County sales and use tax rate changes have been updated for two counties.

5. Taxpayers now have the option of donating part of their refund to the Ohio Historical Society. The Ohio Historical Society is a nonprofit organization that allocates donations toward a matching grants program to support state and local history-related projects throughout Ohio.

6. Taxpayers may now deduct a portion of a federal Pell Grant or Ohio College Opportunity Grant used to pay room and board for a student enrolled in college.

7. The school district tax program has been updated to add four school districts that now have a tax, and to change the rate for six school districts.

8. Ohio has a tax amnesty program, General Tax Amnesty, from May 1, 2012 through June 15, 2012. This amnesty is available for individuals with overdue liabilities in the following taxes: pass-through entity, personal income, school district income, and estate. During General Tax Amnesty, taxpayers can pay unreported or underreported tax delinquencies with no penalties and one half of the interest charge for taxes due and payable up through May 1, 2011.

PENNSYLVANIA

The Pennsylvania tax form now collects use tax due on taxable purchases made over the Internet, through toll-free numbers, from mail order catalogs and from out-of-state locations.