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5 Tax Changes in 2011 Affecting Integrators
Dealers can get tax credits for hiring unemployed workers, buying new equipment and doing business research.
With April 18 fast approaching for your 2010 tax filing, it's never too early to prepare for your 2011 taxes. There are several changes to the tax law that affect integrators. Some are beneficial; some are not.
The new 1099 reporting law, an employee retention credit for hiring a previously unemployed person, and equipment write-off laws are just some of the lesser-known changes that can affect integrators.
According to the New York Enterprise Report, there are five key things to make sure to mention to your tax specialist:
1099 Reporting: We have been tracking this onerous law, which looks like it might be repealed. It was squeezed into the Obama healthcare legislation and requires you to report via a 1099 form all payments you make for goods and services above $600. You need to get a W-9 form from every vendor you work with.
Employee Retention Credit: If you hired an unemployed worker in 2010 (and the worker completed a form W-11) and he stays on your payroll for at least 52 weeks, you are entitled to a $1,000 tax credit.
Mileage Reimbursement Rate Change: The amount you reimburse employees for mileage in their own vehicles in 2011 is now 51 cents, up from 50 cents.
New Equipment Purchase Write-offs: According to the New York Enterprise Report, starting in 2011 there are more favorable tax write-offs that allow you to claim "100 percent bonus depreciation" for new computers, tools, furniture and off-the-shelf software. The law does not apply to pre-owned equipment.
20% Research Credit: A law that expired in 2009 was renewed in 2011. It allows you to get a 20 percent tax credit for research activity.
As always with these types of articles, do not construe this as legal advice. Consult your tax accountant.
The new 1099 reporting law, an employee retention credit for hiring a previously unemployed person, and equipment write-off laws are just some of the lesser-known changes that can affect integrators.
According to the New York Enterprise Report, there are five key things to make sure to mention to your tax specialist:
1099 Reporting: We have been tracking this onerous law, which looks like it might be repealed. It was squeezed into the Obama healthcare legislation and requires you to report via a 1099 form all payments you make for goods and services above $600. You need to get a W-9 form from every vendor you work with.
Employee Retention Credit: If you hired an unemployed worker in 2010 (and the worker completed a form W-11) and he stays on your payroll for at least 52 weeks, you are entitled to a $1,000 tax credit.
Mileage Reimbursement Rate Change: The amount you reimburse employees for mileage in their own vehicles in 2011 is now 51 cents, up from 50 cents.
New Equipment Purchase Write-offs: According to the New York Enterprise Report, starting in 2011 there are more favorable tax write-offs that allow you to claim "100 percent bonus depreciation" for new computers, tools, furniture and off-the-shelf software. The law does not apply to pre-owned equipment.
20% Research Credit: A law that expired in 2009 was renewed in 2011. It allows you to get a 20 percent tax credit for research activity.
As always with these types of articles, do not construe this as legal advice. Consult your tax accountant.
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About the Author
Jason Knott, Editor, CE Pro
Jason has covered low-voltage electronics as an editor since 1990. He joined EH Publishing in 2000, and before that served as publisher and editor of Security Sales, a leading magazine for the security industry. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He is currently a member of the CEDIA Education Action Team for Electronic Systems Business. Jason graduated from the University of Southern California.
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