Dear Clients and Friends:

We hope you had a prosperous 2013 and look forward to working with you in 2014.

For your convenience, we have attached a tax questionnaire that may help you prepare for your tax appointment.

Here are some tax provisions that may impact your individual 2013 tax returns:

•  Sales Tax Deduction: Individuals can deduct either state and local income taxes or sales tax paid during the year as an itemized deduction. Motor vehicle sales tax may be added to this deduction.

•  Itemized Deductions: Except taxpayers over 65, the threshold for medical expense deductions will be 10% of adjusted gross income beginning in 2013. Also, with 2013, the limitation on exemptions and itemized deductions is reinstated for those taxpayers with incomes above $250,000 (S) and $300,000 (MFJ).

•  Capital Gains Tax Rates: Capital gains and qualified dividends rates will remain the same at 15% for most taxpayers. However, for taxpayers making over $400,000 (S), $450,000 (MFJ) capital gains will increase in 2013.

•  New Tax Rate: Beginning in 2013, the 39.6% income tax rate returns for taxpayers making over $400,000 (S), $450,000 (MFJ).

•  Additional Medicare Tax: Beginning in 2013, the employee portion of FICA, normally 1.45% of wages, is increased by .09% on wages in excess of $200,000 (S), $250,000 (MFJ). Furthermore, if you have investment income and a modified adjusted gross income of $200,000 (S), $250,000 (MFJ) you will be paying an additional Medicare tax of 3.8% on the investment income.

•  Teachers and Students: Teachers’ $250 deduction for classroom supplies extended. The American Opportunity Tax Credit for college students was been extended through 2017. Please provide student’s financial account printout from each school showing charges and payments.

•  Limited Non-Business Energy Credits continued for 2013: Be sure to let us know if you think you may qualify for this credit, and bring receipts with you to our tax appointment.

•  Important requirements for reporting foreign assets: If you have financial interests in foreign accounts, or signatory authority of an account in a foreign country, please submit that information to us. There are important requirements for reporting foreign assets.

For additional information and updates, please visit our website

We are very pleased to have added a Chicago location at 10450 S. Western Avenue in association with Ed Lowery, CPA.

Please call to schedule your appointment in Palos Heights, Northfield, Oak Brook or Chicago. Of course, if you are accustomed to mailing your documents prior to your appointment, you may send them to the Palos Heights Office.

We look forward to serving you again this tax season and greatly appreciate your referrals.

Bob Daemicke, EA           Jim Daemicke, CPA            Dan Daemicke, EA           Rita J. Daemicke, EA