Serving individuals and businesses in Virginia and North Carolina for more than twenty five years, Corbin & Company is one of the premier accounting firms in Hampton Roads. Our reputation is built on providing valuable services to meet our clients' needs. News: 2010 and 2011 retirement plan limitations:     2011   2012  Annual 401(k) Deferral Limit  $16,500  $17,000  Age 50 401(k) Catch-up  $5,500  $5,500  Maximum SIMPLE IRA Contribution  $11,500  $11,500  Age 50 SIMPLE IRA Contribution  $2,500  $2,500  IRA Limits  $5,000  $5,000  Age 50 IRA Catch-up  $1,000  $1,000  Annual Compensation Limit  $245,000  $250,000  Defined Contribution 415 Limit  $49,000 + $5,500 401(k) + Catch-up  $50,000 + $5,500 401(k) + Catch-up  Highly Compensated Employee  $110,000  $115,000  Social Security Wage Base  $106,800  $110,100   Expanded 1099 Repeal Signed into Law- On April 14th, President Obama signed legislation repealing the expanded 1099 reporting requirements that were enacted last year. The bill was overwhelmingly approved by the House and Senate. Previous legislation enacted a requirement that individuals who receive rental income issue Forms 1099 to service providers for payments of $600 or more. It did this by specifiying that "a person receiving rental income from real estate shall be considered to be engaged in a trade or business of renting property." As a result of the repeal, the 1099 reporting rules continue unchanged: namely, "All persons engaged in a trade or business and making payment in the course of such trade or business to another person" of $600 or more must report the amount and the name and address of the recipient to the IRS and to the recipient.  Tax Document Retention Guidelines – You must always remember that the burden-of-proof remains on the taxpayer when it comes to supporting taxable income and deductions. This includes keeping accurate records to support entries on your submitted tax forms. In certain circumstances the IRS will allow you to estimate the amounts of deductions but these are very rare, so it is better to keep your records in a safe place. In cases where the IRS finds that you have not maintained adequate records to support deductions taken, they can assess a 20% penalty plus interest on the under-reported amounts, as calculated by the IRS. The IRS has a statute of limitations (SOL) on challenging income and deductions on filed tax returns of three years from the date filed or date due, which ever is later. However, they have a six year SOL if the income is under-reported by 25% or more and there is no SOL for returns that are not filed or are fraudulently filed. You should maintain your records for at least six years to be on the safe side and you should maintain records substantiating basis in assets or any carryovers for six years from the date of disposal or use, not acquisition.