If you do a lot of business on e-Bay or other Internet sites, you might have to report it to the IRS.
Beginning in 2011, payments made to you by banks and third party networks such as PayPal and Google Checkout for credit card transactions will be reported to you on Form 1099-K.
This is one of the current IRS changes detailed during a meeting last night of the Lehighton Council of the Carbon County Chamber of Commerce held in the Beacon Restaurant.
Stanley J. Bushner, CPA with Buckno Lisicky & Company, certified public accountants and business consultants of Lehighton, explained business and personal income tax changes to the chamber members.
"The new schedules require you to separately list the income reported to you. However, they are having issues with the 1099-K reporting so the IRS is not requiring you to separately report these amounts on your 2011 tax return, but you should be aware of this for 2012," Bushner said.
He said residential energy tax credits are available for 2011, but if you have taken any energy credits on your tax return in 2006 to 2010, your 2011 credit will be reduced by the amount of those credits already taken.
He mentioned that teachers in grades kindergarten through 12th grade, who spend money on classroom supplies, can deduct the amount paid up to $250.
Employers who paid for the employee's health insurance must report the amount they paid on the employee's W-2 beginning in 2012. Bushner said this was supposed to be effective in 2011, but the IRS is not enforcing it now.
"We find that many employers are not aware of the new hire reporting, which is required by Pennsylvania. It is every employer's responsibility to report a new hire, or a re-hire after a layoff, within 20 days of the hire/re-hire. There are penalties for not reporting," Bushner said.
One of the new tax credits for 2012 will be The Returning Heroes and Wounded Warriors Opportunity Tax Credit. This credit is for businesses that hire certain military veterans after Nov. 21, 2011 and before Jan. 1, 2013.
Bushner said that under the returning heroes tax credit, an employer may be eligible for a credit up to $2,400 for hiring a veteran who has been unemployed for at least four weeks and up to $5,600 for hiring a veteran who has been unemployed for more than six months.
Under the wounded warriors tax credit, an employer may be eligible for a credit of up to $9,600 for hiring a veteran with a service-connected disability who has been unemployed for six months, and up to $4,800 for hiring a veteran with a service-connected disability who does not meet the returning hero credit requirement or who qualifies as a food stamp recipient.
Bushner said the minimum wage remains at $7.25. The minimum wage for tipped employees is $2.83.