Below we have summarized the provisions that were extended for one year through 2011 and the provisions that became effective in 2011. We hope it will serve as a guide for you. They were compiled by Diane Burke, a very knowledgeable CPA and Director at Cover & Rossiter. For details on any of the provisions, you should speak with Diane, or one of the many CPAs at Cover & Rossiter, to gain a full understanding about the affects they could have on you. Diane can be reached at dburke@coverrossiter.com. All of the facts are supported by the IRS code section.
The following provisions were extended for one year through 2011:- The treatment of mortgage insurance premiums as deductible (Sec. 408 (d) (8))
- The deduction for tuition and related expenses (Sec. 222)
- The state and local sales tax deduction (Sec. 164)
- The deduction for elementary and secondary school teachers (Sec. 62(a) (2) (D))
- Employees of employers with more than 250 employees may see some new information on their Forms W-2 for 2011: The value of the employee’s health insurance coverage sponsored by the employer. This reporting is strictly informational the amount reported will not affect the individual’s tax liability.
- Over the counter medications are no longer reimbursable from health savings accounts (HSAs) Archer medical savings accounts (MSAs), health FSAs or health reimbursement arrangements.
- The additional tax on distributions from an HAS or an Archer MSA that were not used for qualified medical expenses was increased to 20% of the disbursed amount, effective for disbursements made during the tax years starting after Dec. 31, 2010 (Under prior law, the tax was 10% of the disbursed amount for HSAs and 15% for Archer MSAs.
- Property acquired and placed in service between Sept. 9, 2010, and Dec. 31, 2011 may be eligible for 100% depreciation.
- Form 1099 B has been expanded to include the cost or other basis of stock and mutual fund shares sold or exchanged during the year.
