Client Memo – Tax Matter Updates
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California sales tax rates to decrease on July 1, 2011 –

Effective July 1, 2011, the combined statewide sales and use tax base tax rate will decrease from 8.25% to 7.25%.  In areas where there are voter-approved district taxes, the total tax rate related to sales and purchases will be the statewide base tax rate of 7.25% plus the applicable district tax.  For a complete listing of sales and use tax rates by city and county, please visit – Tax Rates effective July 1, 2011.

If you use a cash register in your business, you will need to reprogram it to reflect the lower sales tax rates effective July 1.

IRS increases mileage rate to 55.5 cents per mile –

The IRS recently announced an increase in the optional standard mileage rates for the final six months of 2011.  The rate will increase to 55.5 cents per mile for all business miles driven from July 1, 2011, through Dec. 31, 2011.  This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011.

The new six-month rate for computing deductible medical or moving expenses will also increase by 4.5 cents to 23.5 cents per mile, up from 19 cents for the first six months of 2011. The rate for providing services for charitable organizations is set by statute, not the IRS, and remains at 14 cents per mile.

Estate and gift tax planning considerations –

As part of the Bush-era tax cut being extended in December 2010, the maximum estate tax rate for 2011 and 2012 will be 35%, and the lifetime exemption from estate tax is increased to $5 million per individual.  The gift tax lifetime exemption amount has also been increased to $5 million which means you can give up to $5 million without incurring gift tax.  For married couples, the exemption amount is increased to $10 million.  Note that the generation-skipping tax exemption has also increased to $5 million.

To take advantage of the increased exemptions, you may consider making additional gifts to children and grandchildren during 2011 and 2012.

If you have any questions regarding the above or how they may impact you and your business, please do not hesitate to contact us for a strategic business and tax planning appointment.

Disclosures

Cerity Partners LLC (“Cerity Partners”) is an SEC-registered investment adviser with offices across the United States. Registration as an investment adviser does not imply any level of skill or training.

The information provided is not intended as personalized investment, tax, or legal advice. There is no guarantee that any opinions, projections, or views expressed will materialize. You should consult a qualified professional before making financial decisions.

Information is subject to change without notice and is believed to be reliable but is not guaranteed. For Cerity Partners’ registration status, please visit the Investment Adviser Public Disclosure website at www.adviserinfo.sec.gov.

For additional details about our services, fees, or potential conflicts of interest, please request our disclosure statement, including Form CRS and ADV Part 2, using the contact information provided.

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