Tax Tips: What's New for 2011

Those who haven't yet filed their taxes this year should be aware of a few key changes for 2011 returns, according to the Internal Revenue Service. We've listed just a few of the changes—for more information, visit IRS.gov.

New due date, forms and filing locations

This year's due date for tax returns is April 17—not April 15. Because April 15 is a Sunday and April 16 is the Emancipation Day holiday in Washington D.C., taxpayers get an automatic two-day extension.

The IRS has introduced at least two new forms: Form 8949 (Sales and Other Dispositions of Capital Assets) and Form 8938 (Statement of Foreign Financial Assets). Most people should report their capital gains and losses on the new Form 8949, then write certain totals from that form on Schedule D (Form 1040). People with foreign financial assets in 2011 will probably have to file Form 8938.

In some areas, the IRS has changed the filing location. Those mailing a paper return should see the Form 1040 instructions to find the correct address.

Mileage rates, standard deduction and exemptions increases

Two mileage rates were in effect during 2011. The first, which lasted from Jan. 1 to June 30, allows drivers to deduct 51 cents per mile for business use of their car and 19 cents per mile for medical and moving mileage.

For business mileage during the second half of the year—July 1 through Dec. 31—drivers can deduct 55 1/2 cents per mile. Medical and moving mileage also increased to 23 1/2 cents per mile during the latter half of the year.

The IRS increased the standard deduction for some taxpayers who don't itemize deductions on IRS Schedule A (Form 1040). The amount of the standard deduction depends on a person's filing status.

The amount a person can deduct for each exemption has increased from $3,650 to $3,700 for 2011, according to the IRS.

The alternative minimum tax exemption has also increased to $48,450 for single people, $74,450 for married couples filing jointly and $37,225 for married couples filing separately.

Health coverage tax credit; health savings accounts; self-employed health insurance deduction

The amount of the health coverage tax credit, which pays qualified health insurance premiums for eligible individuals and their families, was increased with recent legislation. "Participants who received the 65 percent tax credit in any month from March to December 2011 may claim an additional 7.5 percent retroactive credit when they file their 2011 tax return," according to the IRS.

For health savings accounts and Archer MSAs, beginning in 2011, only prescribed drugs or insulin are qualified medical expenses, according to the IRS. The additional tax on distributions from HSAs and Archer MSAs not used for qualified medical expenses increased to 20 percent in 2011.

Additionally, taxpayers can no longer deduct self-employed health insurance costs on Schedule SE (Form 1040); however, they can still take the deduction on Form 1040, line 29.

Roth IRAs

Those who converted or rolled over money from a traditional IRA to a Roth IRA or designated Roth in 2010 and didn't elect to report the taxable amount on their 2010 returns generally report half of the taxable amount on their 2011 return and the rest on their 2012 return.

Alternative motor vehicle credit

According to the IRS, the alternative motor vehicle credit can only be claimed for a 2011 car purchase if the vehicle is a new fuel cell car.

First-time homebuyer credit

Though the first-time homebuyer credit has expired for most taxpayers, some military personnel and members of the intelligence community can still claim the credit on their 2011 tax return for qualified purchases.

More information on all of these changes can be found at IRS.gov.