India – How To Save Tax
On December 17, 2010, President Obama signed into law the 2010 Tax Relief Act, which has provisions dealing with income and estate tax and unemployment insurance provisions. What is important about this new law is that it is a temporary measure and, for the most part, only impacts 2011 and 2012 - in other words, it is a band aid. All the Bush-era tax cuts which were scheduled to expire in 2010 will now expire at the end of 2012. That's a pretty scary thought considering that 2012 is a presidential election year and President Obama may be a "lame duck" president without an ability to extend anything past 2012.
Fortunately, most common ATO tax returns mistakes can be caught by double checking everything and going over this simple list before you lodge: Forgotten income. Did you switch jobs this year? Did you earn interest from a bank account? And did you include them on your ATO tax returns? Forgotten income is the most common mistake, especially when it's easily forgotten, like a small amount of bank interest. So make sure you consider all income sources and claim them.
Forgotten deductions and offsets. You'd think people would remember something that helps them with their taxes, but you're dead wrong. Forgetting your tax deductions is the second most common ATO tax returns mistake. And it makes sense, because people don't always realize that things they have, like rental property expenses, are deductions. Be sure and investigate deductions and offsets before you file, because you might be surprised how many you qualify for.
Lodging an incomplete form. Did you ever have the teacher in primary school who would deduct points from your test is you failed to write your name at the top? Well, the ATO tax returns are a lot like that. Forget to include your date of birth, signature, or even your tax file number and the ATO deducts points by sending your forms back and withholding your refund. An easy way to make sure every part is filled out is to use e-tax/e-lodge services. Let the computer remember for you!
There are several personal tax credits and tax deductions that are also extended through 2012. The tax credits that are extended include the Dependent and Child Care Tax Credit ($3,000 for one child, $6,000 for two or more children), the Adoption Tax Credit, the enhanced Earned Income Credit, the Enhanced Child Tax Credit and the American Opportunity Credit. The tax deductions that are extended include a temporary repeal of the dollar limitation on itemized deductions for higher-income earners, temporary repeal of the phaseout for personal exemptions, deduction for student loan interest, sales tax deduction (which is an optional itemized deduction in lieu of the deduction for state income taxes), and tuition and fees deduction (expires in 2011), classroom expense deduction (through 2011).
An agent will come at your place and help you fill the documents which you need to submit at the time of filing for year's tax. This is because of the fact that the process may be confusing and tedious.
So there you have it: the 5 most common ATO tax returns mistakes and how to avoid them. Just give this list a glance before you file next year to remind yourself and then double check for everything on it!
The new law allows married couples to add any unused portion of the estate tax exemption for the first spouse to die the surviving spouse's estate tax exemption. In theory, a married couple should be able to transfer up to $10 million to their heirs free from estate tax without having to use a credit shelter trust. However, it is not exactly clear how this is going to work as this has never been done before. Contact the Law Offices of Laurie Ohall for more information.
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