Every filing season brings changes to Form 1040, U.S. Individual Income Tax Return, and this year is no exception. This Practitioners’ Corner highlights some of the new items on 2011 Form 1040 and its Schedules along with a recap of some of the tax provisions that expired after 2011. Additionally, the threshold for mandatory e-filing of covered returns by specified tax return preparers falls from 100 or more covered returns to 11 or more covered returns for 2012 and subsequent years.

Form 1040, Schedules

The 2011 Form 1040 carries some changes compared to the 2010 Form 1040.

Filing due date. April 15, 2012 is a Sunday. Because of the April 16 Emancipation Day holiday in the District of Columbia, the due date of 2011 Form 1040 moves to April 17, 2012.

First-time homebuyer credit. Members of the military and certain other federal employees serving outside the U.S. had additional time to buy a principal residence in the U.S. and qualify for the first-time homebuyer credit. Generally, qualified military taxpayers had to purchase, or enter into a binding contract to buy, a principal residence on or before April 30, 2011. If a binding contract was entered into by that date, the taxpayer had until June 30, 2011, to close on the purchase.

Repaying the first-time homebuyer credit. For qualified homes purchased in 2008, the first-time homebuyer credit operated similarly to a no-interest loan and taxpayers must repay the credit in annual installments beginning with the 2010 tax year. For 2011, the IRS has advised taxpayers who purchased their homes in 2008 and who used it as their main home in 2011 that they can enter their repayment amount on Line 59b on 2011 Form 1040 without having to attach Form 5405, First-Time Homebuyer Credit and Repayment of the Credit.

Standard mileage rates. The IRS made a 2011 mid-year adjustment to the business standard mileage rate to reflect rising fuel costs. The business standard mileage rate for business miles driven on or after January 1, 2011 and on or before June 30, 2011 is 51 cents per mile. The business standard mileage rate for business miles driven on or after July 1, 2011 and on or before December 31, 2011 is 55.5 cents per mile. The medical/moving rate also experienced a mid-year adjustment in 2011 from 19 cents per mile for the first half of 2011 to 23 .5 cents per mile for the second half of 2011. The statutorily determined charitable mileage rate remained unchanged at 14 cents per mile for all of 2011.

Specified foreign financial assets. The IRS has developed Form 8938, Statement of Specified Foreign Financial Assets, for specified taxpayers to report specified foreign financial assets. Generally, certain taxpayers holding specified foreign financial assets above various monetary thresholds will use Form 8938 to report those assets. Taxpayers must attach Form 8938 to their annual income tax return. The IRS has explained that Form 8938 reporting applies for specified foreign financial assets in which the taxpayer has an interest in tax years starting after March 18, 2010. For most individual taxpayers, this means they will start filing Form 8938 with their 2011 income tax return to be filed this tax filing season.

Roth IRAs. In 2010, a taxpayer may have rolled over eligible distributions from a retirement plan to a Roth IRA, converted (transferred) amounts from a non-Roth IRA to a Roth IRA, or made an in-plan Roth rollover (after September 27, 2010). In any of these events, the taxpayer must report half of the taxable amount of these 2010 rollovers and conversions on his or her 2011 return and half on his or her 2012 return unless the taxpayer elected to include the taxable amount in income for 2010; recharacterized his or her 2010 rollover or conversion to a Roth IRA (in-plan Roth rollovers cannot be recharacterized); or received a distribution in 2010 or 2011 of any of the taxable amount, in which case, the taxpayer may have to report an amount other than half on his or her 2011 return.

Standard deduction. For 2011, the standard deduction for single taxpayers and married couples filing separately is $5,800. The standard deduction for married couples and qualifying widow(er)s is $11,600 for 2011 and the standard deduction for heads of households is $8,500 for 2011.

Exemptions. For 2011, the amount for each exemption is $3,700.

Residential energy credits. Two credits, the Code Sec. 25C nonbusiness energy property credit and the Code Sec. 25D residential energy efficient property credit, reward taxpayers who make qualified energy improvements to their residences. The Code Sec. 25C credit expired after December 31, 2011. The Code Sec. 25D credit is scheduled to expire after December 31, 2016. Both credits are claimed on Form 5695, Residential Energy Credits.

Self-employed individuals. The Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (2010 Tax Relief Act) reduced the OASDI tax rate on self-employment income to 10.4 percent. Because of the reduction, Congress modified the deduction for self-employment taxes under Code Sec. 164(f). For any tax year that begins in 2011, the self-employment tax liability deduction under Code Sec. 164(f) equals the sum of 59.6 percent of the applicable OASDI taxes plus 50 percent of the applicable Medicare taxes.

Small business expensing. For tax years beginning in 2011, the dollar limitation under Code Sec. 179 is $500,000 and the investment limitation is $2 million. A taxpayer may elect to treat up to $250,000 of qualified leasehold improvement property, qualified restaurant property and qualified retail improvement property as Code Sec. 179 property for tax years beginning in 2011.