HSA & Montana Medical Savings Account

Health Savings Accounts                               Federal Tax Deduction
The 2010 HSA contribution maximums are $3,000 for an individual account and $6,150 for a family. 
(HSA holders 55 and older can contribute an extra $1,000 which means $4,000 max or $7,150)

To be eligible for a Health Savings Account, an individual must be covered by a HSA-qualified High Deductible Health Plan (HDHP) and must not be covered by other health insurance that is not an HDHP.  This High Deductible Health Plan must have a minimum deductible for an individual $1,200 and a family $2,400.  The insurance companies know all the details about these HDHP policies. 

For more information about HSA's go to: 

http://www.ustreas.gov/offices/public-affairs/hsa/faq_eligibility.shtml

Montana Medical Savings Account (MSA)    MT ONLY Tax Deduction
All resident taxpayers are eligible to establish a Montana MSA even if they have another health care plan provided by their employer or a Section 125 (Flexible Spending Account) or a Federal HSA. A taxpayer does not have to be in a high deductible plan at work to be eligible for an MSA.

A taxpayer may contribute any amount to a MSA; however each person may only deduct $3,000 plus any interest the account accumulates each year.  Money withdrawn is required to be used for eligible medical expense.  Any money withdrawn not used for eligible medical expenses is subject to a 10% penalty.

You may have a self-administered MSA.  The account must be kept separate from any other account, must be an individual account and you must file an annual report (Form MSA) with your individual Montana return.  
For further information contact Stephanie in our office or
read the following article:
http://msuextension.org/publications/familyfinancialmanagement/mt199817HR.pdf

Increase in IRS Audits

IRS audits have more than doubled in the past decade. Most of the time these are mail audits where an IRS computer mails you a confusingly written message stating there is a mismatch between what was reported on your tax return and what was otherwise reported to the IRS.

As I've mentioned in the past: DO NOT PANIC!!!!! Most of the time we simply have to print out a document and reply to the IRS. With the other audits we simply need to ask a few more questions, but again it does not take too much time to resolve the issue.

Never answer an IRS agent's questions. In the case you get a phone call from an IRS agent, you have a right to representation. If an IRS agent calls you, take the agents' ID number and phone number. Make a note of any questions the agent has and tell them your tax representative will be in touch.

Remember contact us immediately if you get any notice from the IRS. This is why you have a tax accountant, we are here to help you! The IRS has strict deadlines and if you miss a deadline it can be very difficult to challenge an IRS's position after the deadline has passed even if the IRS is in the wrong. 

At this time the IRS does not contact anyone via email.

2010 Standard Mileage Rate

The 2010 federal mileage reimbursement rate is 50¢ per mile.

This is down 8¢ from 2009, mostly due from lower fuel costs.

Checkout our new Appointment Widget!

On our web site you can request an appointment with us for any of our services, check availability, pick your service, select your favorite service provider, submit your contact info, approve your appointment. All without talking to a single person at our office. You are in complete control and we are here to serve your needs any time you need us with just a click away. Check it out!

It's also at the side of this page!

Montana Energy Related Tax Relief

The Department of Revenue encourages citizens to weatherize their homes and take advantage of the Energy Conservation Installation Credit when individual income tax returns are filed.

Montana resident individuals can claim the credit for energy conservation investments made to a home or other building. The credit is equal to 25% of expenses, up to a maximum credit of $500. Two or more people may each qualify for the credit, as long as the building in which the investment is made is owned by all of the people claiming the credit. For example, a married couple who jointly own their home may each claim a credit up to $500 each or $1,000 for the couple.

The following investments qualify for the energy conservation credit:

• Insulation of floors, walls, ceilings and roofs in existing buildings
• Insulation in the floors, walls, ceilings and roofs of a new building to the extent that it exceeds the current International Energy Conservation Code with Montana amendments as adopted by the Montana Department of Labor and Industry
• Insulation of heating and air conditioning pipes, insulation and sealing of heating, ventilation and air-conditioning (HVAC) ducts, and insulation of hot-water heaters and tanks
• Installing windows that result in a reduction of energy consumption
• Installing storm doors and insulated exterior doors
• Caulking and weather stripping of an existing structure
• Installing devices which limit the flow of hot water from shower heads and lavatories
• Installing heat recovery ventilators (HRV)
• Installing glass fireplace doors on existing fireplaces
• Installing exhaust fans to reduce air conditioning requirements
• Replacing incandescent light fixtures of a more efficient type, such as those with electronic ballast and compact or linear fluorescent lamps and LED lights
• Installing lighting controls with cutoff switches to permit the selective use of lights
• Installing programmable thermostats
• Installation of new domestic water heaters, heating or cooling systems, so long as the replacement has an efficiency rating higher than the prior system

For more information go to:
http://mt.gov/revenue/energyconservationcredit.asp

Home Energy Tax Credit - IRS Video

New Homebuyer Tax Credit - IRS Video