10 Strategies for Savvy Tax to Keep in Mind for 2013

It's said the only constant in life is change, and that's definitely the case with taxes. That was made very clear during the tax debates associated with the "fiscal cliff." But all the tax-rate-increase and spending-cut chaos that accompanied fiscal cliff discussions is just part of the picture. Here are 10 tips for taxpayers in 2013.
Tip 1: Get ready to wait
Remember the delays in 2011 when some taxpayers had to wait until mid-February to file their returns because of the late passage of tax laws? Expect the same in 2013. Whether Congress passes new tax laws late in the year or even after the end of a calendar year, the Internal Revenue Service needs time to reprogram its computers to account for the changes. Former IRS Commissioner Doug Shulman, who completed his term just before the presidential election, warned about delays as far back as March 2012. In November, acting IRS Commissioner Steven Miller wrote to the leaders of the House and Senate tax-writing committees, alerting them that the filing of tax returns by as many as 69 million taxpayers could be delayed, some possibly as late as March 2013, because of procrastination by Congress. Most of the inconvenienced taxpayers would be those affected by the alternative minimum tax.
Tip 2: Watch out for the 3.8 percent Medicare investment tax
Several new taxes created as part of the Patient Protection and Affordable Care Act, popularly known as Obamacare, take effect in 2013. The major new tax is a 3.8 percentage point surtax on investment income earned by wealthier taxpayers. Single taxpayers making at least $200,000 and households making $250,000 or more would see this tax added to their investment earnings. Unearned income that will be subject to the new tax includes interest, dividends, capital gains, annuities, royalties and rents. Distributions from individual retirement accounts are exempt from the surtax, but since they are taxable (at your ordinary income tax rate), the retirement account money could increase your adjusted gross income and possibly push you into the Medicare surtax area.
Tip 3: Take note of the 0.9 percent Medicare payroll tax increase
In addition to the Medicare surtax on investment income, individuals who make more than $200,000 ($250,000 for joint filers) in 2013 will see a new 0.9 percent Medicare payroll tax taken out of their paychecks on the amounts earned over their filing status thresholds. Self-employed workers will have to figure the added payroll tax on their earnings, too.
Tip 4: Monitor your medical expenses
A major shortcoming of the itemized medical expenses deduction is that you must rack up enough qualified costs to be able to claim the amount on Schedule A. In 2013, again as part of the health care law, you'll need even more. For the 2012 tax year, you can deduct only the amount of medical and dental expenses that exceed 7.5 percent of your adjusted gross income, or AGI. In 2013, you must have qualified medical expenses that are more than 10 percent of your AGI. Taxpayers age 65 or older, however, can still use the 7.5 percent threshold through 2016.
If you plan to get around the higher deduction threshold by using a flexible spending account, or FSA, to pay for unreimbursed medical costs, that's still a good 2013 tax strategy. But as you learned when you signed up for your medical FSA during your workplace benefits enrollment period, you can only put up to $2,500 into the account. So, plan accordingly for expenditures of this reduced amount.
Tip 5: Determine whether your insurance rebate is taxable
Last fall, health insurers issued more than $1 billion in premium refunds to nearly 13 million consumers. The payments, officially known as medical loss ratio, or MLR, rebates were required by the Affordable Care Act in cases where health insurers did not spend at least a certain percentage (generally 80 percent to 85 percent) of the prior year's health insurance premiums on health care services. The rebates issued in August 2012 covered premiums collected for the 2011 plan year. And in some cases, the rebates are taxable. The general tax rule is that if you got a tax break for the money and then got some of it back, the Internal Revenue Service wants to collect its portion. So, for example, if you paid for your medical insurance and itemized those premiums as part of your medical deductions, at least a portion of the rebate is taxable. The IRS has a frequently asked questions Web page with more on the various insurance rebate payment methods and taxability issues.
Tip 6: Note your company health coverage's value
One more health care act tax provision will show up on your 2012 Form W-2 that your employer is required to send you by the end of January. In Box 12, you'll see how much your workplace-provided medical coverage is worth. Don't worry. You don't have to include the amount, which will have the explanatory code DD next to it, on your tax return. It's for informational purposes only. The IRS will use this data to help it enforce the eventual individual coverage mandate (effective in 2014), as well as collect the so-called Cadillac tax on more expensive workplace insurance plans (effective in 2018).
Tip 7: Pay your 2010 Roth IRA conversion taxes
If you converted a traditional IRA to a Roth account in 2010, you were able to spread any conversion tax payments equally over two subsequent tax years. Your first payment was due with your 2011 tax filing. The second half is due with your 2012 return.
Tip 8: Maximize your workplace retirement plan
Speaking of retirement savings, don't overlook your 401(k) plan. Your contributions are made via payroll deductions before your withholding taxes are calculated, so in addition to saving for retirement, you shave a bit off your tax bill. Many companies make matching contributions to employee accounts. That's basically free retirement money. And the total earnings in the account grow tax-deferred. Each year the IRS reviews the maximum amount that workers can contribute to their 401(k)s and, if warranted, adjusts the contribution levels for inflation. In 2013, you can contribute up to $17,500 to your 401(k). If you're 50 or older, you can add an extra $5,500, allowing a worker who is closer to retirement to contribute as much as $23,000 in a 401(k).
Tip 9: Find a tax professional
Tax laws change every year. And too often, the changes are made late in a tax year, giving you very little time to adjust. If 2013 is the year you decide to get professional help in deciphering the late-breaking and convoluted tax laws and filing your return, start searching for a tax pro now. You have plenty of time to determine which tax professional best fits your tax needs and then thoroughly check out the tax adviser before hiring.
Tip 10: Take your time
Here's one more adage to keep in mind as an important tip for taxpayers: Haste makes waste. That can be true and costly when it comes to taxes. Although the filing deadline is April 15, you can get more time to finish your tax forms. If you need it, take it by filing for an extension with Form 4868. Remember, if you owe a tax bill, you must send in that amount (or close to it) by April 15 or you could end up owing more in late-payment penalty charges.

5 best redesigns for 2013

Just as 1961 was a good year for Bordeaux wine and 1939 was a great year for movies (Gone with the Wind beat The Wizard of Oz at the Oscars), this looks like a promising year for cars.
Automakers have redesigned nearly two dozen models for 2013's U.S. market, and Kelley Blue Book's Jack Nerad says many of the revamped models stand head and shoulders above their 2012 counterparts.
"It's a very, very strong year for redesigns," says Nerad, who recently led a team of KBB editors that picked the new Ford (F_) Fusion as 2013's Best Redesigned Vehicle.
Nerad says consumers will like not only the new Fusion, but also such midsized models as the updated Honda (HMC_) Accord -- "which in any other year would likely win our Best Redesign award. You also have cars in other segments that are good as well, like the redesigned Nissan (NSANY_) Pathfinder SUV."
The expert says the best automotive redesigns are those that make "the largest step forward from what a model was before. A lot of people think it just has to do with exterior design, but interior design and any redoing of a vehicle's mechanics are equally important."
Here's a look at five models that KBB editors believe manufacturers revamped particularly well for 2013.
Nerad says the vehicles below all offer significantly improved styling, comfort, performance, safety, fuel economy, electronics, convenience features, value and overall refinement. All models are listed in order of their manufacturer's suggested retail price.

Honda Accord
Base price: $21,680
This popular midsized car's ninth generation gets a shout-out because "it has all of the Accord virtues that you'd expect -- high fuel economy, a high-tech [base] engine and powerful available V-6," Nerad says. "It's one of those cars that have all-around goodness."
The expert particularly likes the Accord's optional new Honda LaneWatch system, which comes on automatically whenever you make a right turn. Using a rear-facing external camera and a display screen on the dashboard, LaneWatch shows you whatever's in your right-side blind spot so you don't run into it.
The Accord also comes with new direct fuel injection and your choice of two improved engines -- a 185-horsepower four cylinder or 278-horsepower V-6.
Additionally, an optional continuously variable transmission boosts fuel efficiency to an estimated 27 mpg/city and 36 mpg/highway when coupled with the four-cylinder engine. That's better mileage than some versions of the tiny Honda Fit get.

Ford Fusion
Base price: $21,700
The Fusion won KBB's 2013 Best Redesigned Vehicle award in a large part because the midsized sedan has the hottest looks in what's often a boring class of cars, Nerad says.
"When you look at the Fusion's exterior design you say: 'Wow, that's pretty cool,'" he says. "That also extends to the interior design, while the choice of available power trains is almost mind-blowing."
On the outside, the Fusion takes its styling cues from Aston Martin, the sporty British brand that Ford once owned. (Actors Daniel Craig brought James Bond's Aston Martin back to cheers in the recent Skyfall -- then blew it up.)
Inside, the new Fusion boasts a larger cabin than its 2012 predecessor, plus options such as automatic parallel parking and a system that can keep you from drifting out of a lane if you're dozing off.
But the second-generation Fusion really shines under the hood.
KBB editors love the car's three available four-cylinder engines -- a base 175-horsepower version and optional 178- and 240-horsepower turbocharged versions. The turbocharged engines, new for 2013, come with "EcoBoost" technology to improve fuel efficiency.
There's also a Fusion Hybrid that gets 47 mpg city/highway, while a plug-in hybrid version due in showrooms later this year rates 108 mpge (miles per gallon equivalent) in combined city/highway driving.

Ram 1500
Base price: $22,590
Chrysler planned originally to give this full-sized pickup truck "more of a 'freshening,' but that turned into a complete redesign -- and good one at that," Nerad says. "They've done a marvelous job adding features, adding technology and improving the vehicle's look."
The updated Ram features a new base V-6 engine that offers 305 horsepower, a 42% boost from 2012. Still, the model gets as much as 24% better fuel economy than last year -- 21 mpg combined city/highway for the 2013 Ram 1500 HFE vs. 16 mpg for the 2012 Ram 1500 ST.
The base 2013 Ram also comes standard with a new fuel-saving eight-speed automatic transmission.
Additionally, an optional new air-suspension system lets you raise the Ram's height by two inches for increased ground clearance or lower it two inches for easier passenger access and better aerodynamics. There's also an available engine start/stop system that can minimize idling and save even more gas.
Inside, the Ram's redesigned interior offers an optional new 8.4-inch multifunction touchscreen, as well as the next generation of Uconnect Access -- Chrysler's well-regarded "infotainment" system.
"[Chrysler] transformed a truck that we liked a lot into a truck that we like a lot more," Nerad says. "I think they did a very good job all around."

Nissan Pathfinder
Base price: $28,650
Nissan redesigned the seven-passenger Pathfinder radically for 2013, changing it from a rugged sport utility vehicle with good off-road capabilities into a more refined model that emphasizes comfort over toughness.
To begin with, the Japanese automaker switched the Pathfinder from a truck chassis to a car-based platform -- allowing for smoother driving, 500 pounds less weight and better fuel efficiency.
Nissan also boosted the fourth-generation Pathfinder's mpg by adding front-wheel drive, a continuously variable transmission and an improved 260-horsepower V-6 engine as standard equipment. All told, the 2013 2WD model gets an estimated 22 mpg combined city/highway mileage -- 30% better than the 2012.
The improved efficiency comes despite the fact that the new Pathfinder has 8.4 cubic feet more interior space than its 2012 predecessor.
Nissan also added convenient "EZ Flex" seating -- second-row seats that slide 5.5 inches forward to make accessing the model's third row easier. Additionally, the second- and third-row seats fold flat for added cargo capacity.
"The Pathfinder's exterior redesign is very handsome, and its new interior is much better in terms of usability," Nerad says.

Porsche Boxster Convertible
Base price: $49,500
Nerad calls the redesigned 2013 Boxster Convertible a "heart-stop version" of Porsche's sexy two-seat sports car.
The third-generation Boxster combines an updated exterior with a larger interior, new LED taillights, fuel-efficient electric-assist steering and bigger wheels and tires for better road grip.
The 2013 version also comes standard with a 265-horsepower six-cylinder engine that's 10 horsepower stronger than its predecessor but uses less gas. A 2013 Boxster with manual transmission gets 24 mpg in combined city/highway driving -- 2 mpg higher than a comparable 2012.
Porsche also boosted the Boxster's aluminum content, cutting some 80 pounds off of the car's weight to improve agility and increase gas mileage.
"We really love the new Boxster," Nerad says. "I can't think of a sweeter car."
 

Happy Birthday Kapil Dev: The Master of All Crafts

India's greatest all-rounder Kapil Dev was born on 6 January 1959 in Chandigarh. Kapil, who captained India when they won the 1983 World Cup, was named by Wisden as the Indian Cricketer of the Century in 2002; he was also India's national cricket coach for 10 months between October 1999 and August 2000. Nicknamed The Haryana Hurricane, Kapil is  the only player to take more than 400 wickets and score more than 5,000 runs in Test cricket. Kapil has a long list of achievements to his name during his illustrious career, but the 138-ball 175* he scored against Zimbabwe in the 1983 World Cup, is one of the great knocks in ODIs. On 8 March 2010, Kapil was inducted into the ICC Cricket Hall of Fame. Kapil was the only Asian founding member of Laureus Foundation in 2000. Ian Botham and Viv Richards were the other two cricketers on the founding member council of 40. Steve Waugh was added to the Academy members in 2006 when it was expanded from 40 to 42.

1983: India Captain Kapil Dev holds the trophy aloft after the World Cup match against the West Indies at Lord's in London. India won the match by 43 runs. 

 

Kapil Dev of India with the Wisden Cricketer of the Century Trophy during the Indian Wisden Cricketer of the Century Awards at Wembley Conference Centre in London on July 23, 2002. 

 

Nov 1984: Portrait of Kapil Dev of India.

 

Dec 1984: Kapil Dev of India stretches before a match.

 

Nov 1988: Indian All-rounder Kapil Dev appeals for a wicket during the 1st Test against New Zealand in Bangalore.

 

Nov 1984: Kapil Dev of India in action during a match. 

 

June 1983: Kapil Dev of India crashes another boundary during his innings of 175 not out in a Cricket World Cup match against Zimbabwe.

 

India captain Kapil Dev in bowling action. 

 

25 Jun 1983: Cricket World Cup final at Lords. Andy Roberts of the West Indies loses his wicket to Kapil Dev as India power to victory in the final at Lords. Joel Garner is the non striking batsman.

Indian cricket captain Kapil Dev during his record innings of 175 not out off 138 balls against Zimbabwe in the Cricket World Cup at Nevill Ground, Tunbridge Wells, Kent, 18th June 1983. India won the match by 31 runs and later won the tournament. Kapil Dev (left) bowling for India during the Fourth Test against England at Calcutta, during the England tour of India, January 1982. Dev shows his jubilance at having Boycott caught behind. Kapil Dev and Family arrives at a cocktail reception at the Yacht Club de Monaco in Monte Carlo on 13 May, 2002. The 3rd Annual Laureus World Sports Awards honours the achievements of the world's greatest sportsmen and women.

1 Jan 2000: India cricket coach Kapil Dev looks on during cricket nets before the Third Test match against Australia at the Sydney Cricket Ground, Sydney, Australia. 21 May 2001: World Sports Academy founder member and former cricketer Kapil Dev celebrates during the Laureus Golf Challenge at the Monte Carlo Golf Club prior to the Laureus World Sports Awards in Monaco. Dec 1983: Kapil Dev bats for India during the 5th Test between India and England at Calcutta. 1987: Kapil Dev of India in action during the World Cup semi-final against England at Wankhede Stadium in Bombay, India. 13 Mar 2001: The World Sports Academy (back row, L to R) Kapil Dev, Edwin Moses, Hugo Porta, Migual Indurain (front row, L to R) Morne du Plessis, Dawn Fraser, Mark Spitz, Nadia Comaneci and Boris Becker at the annoucement of the Laureus World Sports Award Nominations at the Hotel Adlon, Berlin, Germany. Digital Image. Indian cricket legend Kapil Dev, practices in a dance class with a Chinese student from Lu Jia Zui Special School, a local school in partner relationship with "Special Olympic Shanghai" to promote a special activity in Shanghai, China on March 29, 2003. Ten academy members of Laureus Awards were in Shanghai for the announcement of the nominees for the 2003 Laureus World Sports Award. Laureus Academy Members Ian Botham (L), Kapil Dev and Steve Waugh (R) walk down the fairway during the the Laureus golf challenge at the Oitavis Golf Club May 9, 2004 in Quinta Da Marinha, Portugal. Torchbearer Kapil Dev carries the Olympic Flame outside the Red Fort during Day 7 of the ATHENS 2004 Olympic Torch Relay on June 10, 2004 in Delhi, India. The Olympic Flame travels to 34 cities in 27 countries en route to the Athens 2004 Olympic Games. Kapil Dev bowls for India during the First Test Match against England at Lords, June 1982. Kapil Dev and Kiran More of India celebrate victory during the Third Test match between India and England held on February 23, 1993 at the Wankhede Stadium, in Bombay, India. Kapil Dev of India hits his second shot at the 18th hole during the Pro Celebrity Challenge as a preview for the 2008 Johnnie Walker Classic held at The DLF Golf and Country Club on February 26, 2008 in New Delhi, India. Kapil Dev, the legendary Indian cricketer, conducts a clinic for youth players at the Awali Cricket Club in Riffa, as a part of the preview to the Riffa Invitaional, for the opening of the Riffa Views Golf Course, on November 12, 2008 in Riffa, Bahrain Kapil Dev of India hits his tee shot at the 4th hole during the opening of the par 3 course as part of the celebration of the completion of construction of the Montgomerie Course at Riffa Views on November 14, 2008 in Riffa, Bahrain.

Big Boss Boo-Boos: 6 Leadership Mistakes to Avoid: he 6 leadership mistakes to avoid

If you've recently been promoted, congratulations. It's an honor to receive a promotion that puts you in a leadership role. But be wary: You carry a great deal of responsibility that can easily be taken away should you not live up to expectations. Not to set off alarm bells, but of people who have been promoted, a full 40 percent of them will fail within their first 18 months on the job. Most of the failure stems from a few key leadership mistakes that The Forum Corp.'s President and CEO Andrew Graham outlines:
1. Alienating your team. Graham says that you likely got your promotion by standing out from others, but now that role has changed. Rather than focusing on continuing to shine alone, you need to help your subordinates stand out. "If your subordinates or peers perceive that you care more about your interests than theirs, you will lose them. And once you lose them, you will lose, period," he says.
2. Keeping the same mindset. You got where you are by being really good at a few key skills for the job. You can just about toss those out of the window if you want to be a good leader, because, as Graham says, your focus should now be on "high-value activities that deliver business results through the team." It's all too common for new managers to make the mistake of focusing on low-value activities (think:TPS reports) that don't benefit the team and that are others' responsibilities.
3. Not asking for help. You're the leader now. That means you're expected to know everything ... doesn't it? Not at all. Rather than being overconfident you can handle a situation you've never encountered before, the smart thing is to ask for input from others. "Asking for help is not a sign of weakness; it's the contrary," stresses Graham. Understand that your team will respect you for saying you don't know the answer to a question, but that you will make it a priority to find it.
4. Making all the decisions alone. Leaders should lead, not dictate. But many feel like the key to leading is taking on all the decisions on their own. Rather than being seen as a fine leader, you will be resented for leaving your employees out in the cold on a decision they felt entitled to weigh in on. Instead, involve other team members in your decision-making process so that you build a sense of community and democracy, not a dictatorship.
5. Ignoring transitions. You being promoted to manager or leader isn't the only transition you need to deal with. While you're settling into that corner office, your new team is adjusting to having a new person at the helm, and all the personal interplay that brings among co-workers. Not spending enough time making that transition smoother can set the course for how your team operates, and it might make things more difficult down the road.
6. Leaning too hard on book smarts. So you went to an Ivy League school. So what? All the fine education in the world can't prepare you for cultivating your people-leadership skills, which account for 85 percent of a leader's success, according to Graham. You can apply what you've learned in books, but the best leaders help their staff learn to solve problems themselves, and teaching that can't be learned anywhere but on the job.
The first few months of taking on a leadership role are the most precarious. Begin to think like a leader and focus your actions around what is best for the team. Ask for feedback from your staff and your own boss so that you can quickly correct anything that could stand to be improved.

Ten shocking celebrity splits of 2012

One would believe that celebrities are not as committed to their relationships as compared to the less-known mortals of the society. But some couples do indeed prove us wrong.

The following stories however, instil some more confidence in the above-mentioned belief:

1. Tom Cruise – Katie Holmes
To what was touted as the golden couple, came a rude end. Tom Cruise and Katie Holmes split after being married for close to 6 years. Holmes was reportedly upset over Tom Cruise’s tryst with Scientology. Apparently, Tom Cruise had announced his love for Katie Holmes on the Oprah show, as he was seen jumping on the couch. Things however seemed to have taken an ugly turn over past one year or so. They both remain committed to their daughter, Suri. 

 

2. Johnny Depp and Vanessa Paradis
The heartthrob of all ages, Johnny ‘Sweeney’ Depp broke up with his wife Vanessa Paradis back in June of this year. The year started with rumours about their split doing the rounds. Denial is what we got to hear first, until the split materialized. Johnny Depp however, is rumoured to have gotten close to his ‘The Rum Diary’ co-star Amber Heard. Assuming this one isn’t a false rumour, that’s quite a catch! Way to go Johnny! 

 

3. Heidi Klum –Seal
After much soul searching, we decided to separate”- This is what the couple had to say after their marriage ended on a not-so-sour note. Fans were spared the drama that accompanies such splits, as the couple parted with dignity. They have three kids together.

 

4. Katie Price and Leandro Penna
The bombshell Katie Price broke-up with her Argentinian lover Leandro Penna. He went on to say in the media that Katie is ‘crazy’. Ouch!

 

5. Katy Perry & Russell Brand
The couple who had a grand wedding in India, decided to call it quit after being together for around one year. Cracks in the marriage were split wide open and nakedly visible as both of them were spotted without their rings, even before they announced their divorce.

 

6. Ronan and Yvonne Keating
Ronan Keating’s fling with the backing dancer Francine Cornell eventually led to the divorce after a struggle of 2 years.

 

7. Kristen Stewart and Robert Pattinson
The ‘Twilight’ couple hit rock bottom when Kristen was spotted having some candid moments with the director of ‘Snow White and the Huntsman’, Rupert Sanders. Fans were in shock, Robert seemed to go in despair, the news of the break-up was all over the papers and the paparazzi were having a great time. And then came the last instalment of ‘Twilight’ series and things came back to normal. Pattinson ‘forgave’ Kristen and two are again dating each other. 

 

8. Justin Bieber and Selena Gomez
After almost 2 years of being together, cracks have begun to show. The reports of Bieber’s growing closeness to Victoria's Secret model, Barbara Palvin, upset Selena. Reportedly, she dumped Bieber.

 

9. Myleene Klass and Graham Quinn
The six-month-old marriage of the couple hit rock bottom when Graham allegedly walked out of his wife’s 34th birthday. 

10. Simon Cowell and Mezhgan Hussainy
The popular American Idol Judge broke up with his fiancé after being together for more than 2 years. Cowell has since moved on and is currently dating Janina Gavankar.