Special hardship relief has been provided to certain wage earners and self-employed individuals for tax year 2011. For qualifying individuals, the IRS is providing a six-month grace period on failure-to-pay penalties. Penalty relief will be available to two categories of taxpayers: (1) wage earners who have been unemployed at least 30 consecutive days during 2011 or in 2012 up to the April 17 deadline for filing a federal tax return, and (2) self-employed individuals who experienced a 25-percent or greater reduction in business income in 2011 due to the economy.

In response to rising gasoline prices, IRS raised the standard mileage rate for business use of an automobile from $0.51 per mile to $0.555 per mile, effective July 1. The medical and moving standard mileage rate is increasing to $0.235 per mile, also on July 1.

The standard mileage rate for services to charitable organizations is set by statute at $0.14 per mile and remains unchanged.

On November 11, 2009, President Obama signed into law the Military Spouses Residency Relief Act. The Act is effective beginning for 2009 tax year.

The Act provides that a spouse shall not lose or acquire the domicile or residence in a state when the spouse is present in the state solely to be with the servicemember in compliance with orders that result in each residing in the same state.

If you are a volunteer worker for a charity, you should be aware that your generosity may entitle you to some tax breaks.

Although no tax deduction is allowed for the value of services you perform for a charitable organization, some deductions are permitted for out-of-pocket costs you incur while performing the services (subject to the deduction limit that generally applies to charitable contributions). This includes items such as:

With the greatly depressed value of housing, now is the time to consider a special kind of irrevocable trust that can be used to transfer your residence to your children at a significantly reduced gift tax cost and with no estate tax, yet allow you to continue to live in the residence for as long as you wish. This special type of trust is known as a qualified personal residence trust (QPRT). (QPRTs are sometimes also referred to as “residence GRITs” or “house GRITs”.) Here's how it works.

What is expected to substantiate the deduction for using a vehicle for work? Whether it is a claim for actual expense incurred or the standard mileage rate, the IRS requires substantiation of the use. This is a good time to review

How to substantiate business/investment use of a vehicle --

Deductions for the business/investment use of vehicles (including both cars and trucks) are not allowed unless the usage is substantiated with an adequate record of the following elements:

1) The date, mileage and business or investment purpose of each trip;

New Deductions and Credits for South Carolina Taxpayers

South Carolina offers deductions and credits for those whose home insurance premiums are "excessive." In a nutshell, these deductions and credits include the following: