Ask TaxMama Issue #1 – Merrily We Tax Along…

Ask TaxMama

Merrily We Tax Along…

Welcome to the first edition of Ask TaxMama. AskTaxMama will be
published every two weeks. You will find the complete text of this
issue on the site at http://taxmama.wpengine.com/AskTaxMama/asktm_1.htm

Lower Standards

For the first time in anyone’s memory, the IRS arrived at a standard mileage rate that was lower than the year before. It was such a surprise that large corporations who offer mileage reimbursements were caught waaay off guard. As a result, the IRS has delayed the effective date of the new lower rate. It won’t go into effect until April 1, 1999.

You must carefully track your auto mileage this year. Keep good records of your miles driven for business for the first three months if you want to get a higher deduction for those miles than the ones you drive during the last nine months.

Standard Rate per Mile
32.5 Cents – 1998
32.5 Cents – 1999, Jan 1 – Mar. 31
31.0 Cents – 1999, April 1 – Dec. 31

~~~~~~

Out of House and Home

You know that if you sell your home, you probably won’t have taxable gains anymore. So does the IRS. No more Form 2119. Now, you report the sale of your home on Schedule D.

Remember, if you had an office at home, you may have taxable gains.

Speaking of Offices at Home …

Ta Daaa! Effective the first of this year, your self-employed business finally qualifies for an office in home deduction. (Most likely.) Starting this year, you don’t actually have to do all the work in your own
home office (like a plumber, consultant, doctor, etc.) to be able to take the deduction. Ask me for more details – or wait for the article to appear at the TaxMama
site

http://taxmama.wpengine.com

Alert: It is still a red flag – and still has other unpleasant tax consequences.
So don’t get carried away.

~~~~~~

Critical Dates:

1998 4th Est Tax Payments 01/15/99 ** Corporate Returns Due 03/15/99
Payroll/Sales Tax Returns 01/31/99 Corporate Returns Due 03/15/99
W-2’s, 1099s must be filed 02/28/99

Partnership Returns Due 04/15/99 2nd Est Pmt Due 06/15/99
Personal Returns Due 04/15/99 1st Ptrship Ext Expires 07/15/99
1999 1st Est Tax Pmt Due 04/15/99 1st Personal Ext Expires 08/15/99
Corp Ext Expires 09/18/99

** If you need forms to make your 4th estimated tax payment for
1998, you can find a fill-in version of Form 1040 ES at
http://www.irs.ustreas.gov/forms_pubs/fillin.html
(That means you can download a form that you can fill in from your
own computer, then print.)
Or you can find a regular, printable form at
http://www.irs.ustreas.gov/forms_pubs/forms.html

(Hint, look in the window past all the Forms 1040, the Forms 1040A,
then you’ll find these.)

~~~

Payroll Changes To Note

Withholding and payment rates haven’t changed. But the amount on which you
withhold or pay always does. Remember, employers pay double:

Rate Limit
Social Security 6.2 % $68,400
Medicare 1.45% None
Fed Unemployment. 6.2 %* 7,000
Self Employ Soc. Sec. 12.4% 68,400
Self Employed Medicare 2.9% None

*Each state has credits against this. Most will bring the actual rate down
to .8%

__

Ask TaxMama is published by the good folks at http://taxmama.wpengine.com© copyright, Eva Rosenberg, 1999

Written permission is required to copy or redistribute this publication.
mailto:taxwriter@taxmama.com

This publication is only sent via voluntary subscription. If you wish
to unsubscribe at any time, please include your name in the e-mail
mailto:asktaxmama@taxmama.com and UNSUBSCRIBE in the
subject line.

Moderator, HelpDesk, http://www.audettemedia.com/i-help
Tax Professional ExtraordinAire – http://www.taxmama.com (soon)
Tax Newsletter: Ask TaxMama taxwriter@taxmama.com
The Original GiftSurfer http://www.mywishlist.com
SHOP THE WEB IN 99 – PASS IT ON

One thought on “Ask TaxMama Issue #1 – Merrily We Tax Along…

  1. Pingback: Tax Issues Regarding Copyrights, Patents and Trademarks | Time to Start Up! Time To Startup!

Leave a Reply