ARE YOUR LABOR-LAW POSTERS OUT OF DATE?

The average employer spends up to $1,000 per year in employee time to track, order and follow through on labor-law posting compliance issues.  Why?  The U.S. Labor Department and each state’s government require employers to post certain employment-law information that explains employees’ rights and responsibilities.

The five major federal poster requirements include: 

• Equal employment opportunity
• Federal Minimum Wage
• Job safety and health protection
• Employee Polygraph Protection Act
• FMLA (regulations regarding employees taking unpaid leave)

In addition to the mandatory posters, if you employ workers with disabilities and you pay them under special minimum-wage certificates, you must post notices of those wage rights.  Plus, agricultural employers and farm-labor contractors who employ migrant or seasonal agricultural workers must post a notice of employees’ rights under the Migrant and Seasonal Agricultural Worker Protection Act.

The Labor Department offers free, downloadable copies of the required posters at its website, www.dol.gov, as do many of the state agencies.

DONATIONS

Starting in 2007, cash donations of any size must be substantiated by paperwork that includes either a cancelled check or a written acknowledgment from the charity indicating the amount of the donation, date and name of charitable organization.

MORTGAGE INSURANCE

For a limited time, premiums for qualified mortgage insurance can be treated as qualified residence interest and deducted.  The premiums must be paid or accrued for qualified mortgage insurance obtained in connection with acquisition indebtedness on a qualified residence.  The deduction is scheduled to terminate for premiums paid or accrued after December 31, 2007, or properly allocable to any period after December 31, 2007.  The deduction is also subject to an income phase-out.  For every $1,000 or fraction thereof, by which a taxpayer’s adjusted gross income (AGI) exceeds $100,000, the amount of mortgage insurance premiums that can be treated as qualified residence interest is reduced by 10 percent.  In the case of a married taxpayer filing separately, the amounts are lowered to $500 and $50,000.

Source:  CCH Federal Tax Weekly

Would you like to be informed when our next newsletter is available?

Join our
mailing list

Weekly Tax Tips

September 6, 2010
August 30, 2010
August 23, 2010
August 16, 2010

Monthly Tips

Business September 2010
Financial September 2010

OVERLOOKED MEDICAL DEDUCTIONS

While it is common knowledge that taxpayers may deduct qualified medical expenses for themselves and their dependent children, other opportunities to deduct medical expenses are not so widely known.  One is the deduction of medical expenses that a taxpayer pays on behalf of others, even if they are not claimed as dependents.  Several other medical deductions are commonly overlooked.

Taxpayers can deduct qualifying medical expenses paid on behalf of individuals whom they could claim as dependents except for the fact that the individuals claim dependents of their own, file a joint return or receive gross income in excess of the exemption amount.  The child of an ill parent, for example, can deduct payments for the parent’s health care costs provided all other dependency requirements are met, even though the parent files a joint return and has a gross income greater than $34,000.

Unrelated members of a taxpayer’s household may also qualify as dependents.  In some circumstances the medical expenses of a domestic partner are deductible.  However, the dependency requirements for unrelated parties are stricter than those for family members; an unrelated person must share the same principal place of abode as the taxpayer and be a member of the taxpayer’s household for the taxpayer’s entire tax year.

The treatment of a chronic illness or disability can be extremely costly.  Fortunately, certain services that would otherwise be nondeductible as medical expenses are deductible qualified long-term care costs:

• Long-term care insurance premiums subject to age-related limits.
• Maintenance and personal care services, including meal preparation and housekeeping, if the services are rendered to assist with daily activities that chronically ill individuals are unable to perform on their own.
• Meals and lodging for an in-home caregiver if the caregiver is unrelated or is licensed.
• Nursing homes, assisted-living facilities and dementia facilities.  All reasonable costs – including those for meals, lodging and personal care – are deductible if the patient is admitted for medical reasons. 

Commonly Overlooked Deductions

• Nonelective cosmetic surgery (that is, promoting proper function of the body or preventing or treating illness or disease).
• Dental work, if not purely cosmetic.
• Hearing aids and prescription eyeglasses, including the cost of examinations and prescriptions.
• Non-physician-provided medical services if related to a medical condition, including nontraditional treatments, such as acupuncture and Christian Science healing practices.
• Psychotherapy and psychiatric counseling.
• Smoking-cessation programs, including prescription drugs to alleviate nicotine withdrawal.
• Transportation to and from medical treatment, including tolls and parking.
• Weight-loss programs for treatment of physician-diagnosed disease.