Monday, January 10, 2011

Relocation Tax Law Changes

During the last month of 2010, Congress signed into law the Economic Growth and Tax Relief Act of 2010. The changes that we need to be aware of are:


• The new law reduced the employee's share of Social Security tax for 2011 from 6.2% to 4.2%.
• The new law extends the income tax rates for two years for everyone.
• Temporarily extends the 10% bracket.
• Temporarily extends the 25%, 28%, 33% and 35% tax brackets through 2012.
• The 15% top rate for capital gains and qualified dividends will remain for 2011 and 2012.
• Temporarily repeals the personal exemption phase-out.
• Temporarily repeals the itemized deduction limitation.
• Temporarily extends the current modified child tax credit. The amount stays at $1,000 per child and may be refundable.

• Per IRS Notice 2010-88 the 2011 mileage rates are:
o Business Standard Mileage Rate: 51 cents per mile
o Moving/Medical Standard Mileage Rate: 19 cents per mile
o Charitable Standard Mileage Rate: 14 cents per mile

• Two year alternative minimum tax (ATM) patch for exemption amounts:
o 2010 $47,450 (individuals) $72,450 (married filing jointly)
o 2011 $48,485 (individuals) $74,450 (married filing jointly)

Relocation Benefits Expense Management Software continually updates federal and state tax changes so that you can be sure that your employee expense management is handled properly.

To find out more about our EXPENSE MANAGEMENT SERVICES please contact me andy@relocationbenefits.com

Saturday, January 1, 2011

2011 IRS Mileage Rate

The 2011 Standard IRS Mileage Rate for the use of a car during the final trip from the origin location to the final destination is $0.19 per mile. Companies reimbursing mileage to employees on their final trip need to be aware of this difference from the standard business mileage reimbursement.

The standard business mileage reimbursement for 2011 is $0.51 per mile. This rate is up 1 cent from 2010 rates. This is a $0.32 sent difference from the moving mileage reimbursement.

Most companies include in their policy the reimbursement of miles driven at the standard business mileage rate. This practice is very common but during most audits by the IRS this is the one overlooked taxable expense that is missed during the taxable reimbursement reporting process.

For more information on our Relocation Tax Audit Service please give me a call or send me an email: 877-396-0132 or Andy@relocationbenefits.com