Tax filing deadlines are coming up next week, says Ron Haugen, North Dakota State University Extension Service farm economist.
You have until March 1 to file returns without penalty.
If you made an estimated tax payment by Jan. 17, you have until April 16 to file.
Some things to note when you are preparing taxes are:
The 179 expense election is $500,000. Generally, the 179 expense election allows you to deduct up to $500,000 of machinery or equipment purchases for the year of the purchase. There is a dollar-for-dollar phase-out for purchases of more than $2 million. It is scheduled to revert to $139,000 for 2012 unless Congress acts.
The additional first-year bonus depreciation provision is in effect. It is equal to 100% of adjusted basis after 179 expensing. It only applies to new property that has a recovery period of 20 years or less. The bonus depreciation is set to return to 50% in 2012.
The standard deduction is $11,600 for those who are married and filing jointly. The deduction is $5,800 for singles. The personal exemption amount is $3,700.
Qualified dividend income is taxed at a 0% rate for individuals in the 10 or 15% tax brackets and at 15% for those in higher tax brackets.
Long-term capital gains are taxed at a 0% rate for individuals in the 10 or 15% tax brackets and at 15% for those in higher tax brackets.
The child tax credit is $1,000 for each qualifying child.
The annual IRA contribution is $5,000 for 2011 or $6,000 for individuals 50 or older.
The annual gift tax exclusion is $13,000.
The 2011 Social Security wage base is $106,800.
The business mileage rate for 2011 is 51 cents per mile to June 30, 2011, and 55 1/2 cents after that.
Crop insurance proceeds, if received in 2011, may be deferred to 2012 if you qualify. You must use cash accounting and show that, under normal business practices, the sale of damaged crops would occur in a future tax year.
A livestock deferral can be made by those who had a forced sale of livestock because of a weather-related disaster. Two methods can be used. In the first method, income can be deferred to the next year for all types of livestock sold prematurely. In the second method, income from livestock held for draft, breeding or dairy purposes is not taxed if like-kind animals are repurchased within four years (or more depending on weather conditions or disaster declarations) from the end of the tax year in which the animals were sold. Only the gain on the sale of those animals beyond what normally was sold would qualify for postponement.
If you qualify, you can elect to compute your current tax liability by averaging, during a three-year period, all or part of the current year elected farm income. This is done on Schedule J. North Dakota farmers who elect to use income averaging for federal purposes also may use Form ND-1FA, income averaging for North Dakota income tax calculations.
Information on agricultural tax topics can be found in the "Farmers Tax Guide," publication 225. It is available at any IRS office or can be ordered by calling (800) 829-3676. Any questions about these topics should be addressed to your tax professional or the IRS at (800) 829-1040 or http://www.irs.gov. Call the North Dakota Tax Department at (877) 328-7088 or go to http://www.nd.gov/tax/ for answers to North Dakota income tax questions.Source: NDSU Extension Communications