As you prepare to file your taxes in 2013 (for the 2012 tax year), it’s important to be on top of things. Every year, there are changes to the tax code. This year, though, there are a few widespread impacts. Here are some things to keep in mind as you get ready for filing your taxes this tax season:
1. Filing is Delayed
This year, tax return filing is delayed for everyone. First of all, the IRS isn’t even accepting tax returns until January 30, 2012. However, there are some filers who have to wait until as late as March to file. Some of the forms are being updated as a result of the recent fiscal cliff tax deal, and that means that the IRS isn’t ready for them. You need to check with the IRS, or with a trusted tax professional to find out whether or not you need to wait to file.
2. Even If Your State Recognizes Your Same-Sex Marriage, the Federal Government Doesn’t
Many states now recognize same-sex marriage or civil unions. However, the fact that your state recognizes your relationship status doesn’t mean that the federal government does. The Defense of Marriage Act (DOMA), which was passed in 1996 means that same-sex couples can’t file as “married” — whether it’s married filing jointly or married filing separately.
However, the Supreme Court could very well overturn DOMA this year. It won’t happen before you file your taxes, though, so if you are in a same-sex relationship, you might want to file your taxes with a “protective claim,” just in case DOMA is struck down.
3. You Can Still Claims Deductions for 2012
Even though 2012 is over, you can still claim certain deductions for the previous year. You can still contribute to your Traditional IRA, as well as to your Health Savings Account, for 2012. Just clearly indicate that you are making a previous year contribution. Realize, too, that you won’t be able to claim your contributions for deductions in 2013 if you claim them for 2012. You have until April 15 to claim these deductions for the previous year.
4. The 1099-K is Rolling Out
After some delay, the 1099-K is officially rolling out for tax year 2012. This is a form issued by third-party payment processors that handle business transactions. Credit card processors, banks, and PayPal are among those keeping track of your transactions, and issuing 1099-K forms. If you are a home business that does at least 200 transactions and at least $20,0000 a year through a third-party payment processor, you can expect to see the 1099-K. And you might see it anyway, if the processor decides to issue one to you. Realize that only gross income is reported, so you will have to document expenses and other costs. Plus, you need to be on the watch for duplicate income, since you might receive 1099-MISC forms from those who pay through PayPal. This can mean that the IRS thinks you are making more than you actually have as income.
If you are a non-payment-processing business, you don’t issue 1099-K forms to your independent contractors. They still receive 1099-MISC forms. Check with your accountant to determine whether or not the issuance of a 1099-K from a third-party precludes you from filing the 1099-MISC.
Double-check your tax situation, and take steps to ensure that you are ready to file your 2012 tax return.