The Making Work Pay Tax Credit won’t be available this tax season as the government limits tax deductions, write-offs and credits for 2011 and 2012. Also this tax season, the tax penalty for non-qualified distributions from HSAs and Archer MSAs is increasing.
Employers should be aware of these and other changes, many of which are listed in the “What’s New” page on the 2011 Form 1040 . See page 6. That page says:
- Tax day is April 17, because April 15 is a Sunday and April 16 is “Emancipation Day,” a holiday in the District of Columbia.
- The Making Work Pay Tax Credit, which gave tax credits of up to $400 for working individuals and $800 for married working folks, will cease to exist, and Schedule M no longer exists for filing year 2011.
- The additional tax on non-qualified distributions from Health Savings Accounts and Archer MSAs increased to 20 percent.
- You cannot claim the Alternative Motor Vehicle Credit for a vehicle you bought after 2010, unless the vehicle is a new fuel cell motor vehicle.
- The self-employed health insurance deduction is no longer available in Schedule SE; but is still available on 1040 line 29.
- The alternative minimum tax exemption amount increased to $48,450 ($74,450 if married filing jointly and to $37,225 if married filing separately).
- The standard reimbursement rate for mileage incurred in business use of personal vehicles was 51 cents per mile between Jan. 1 and June 30, 2011, when it increased to 55.5 cents per mile.