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Table of Contents

  1. What is the automobile mileage rate?
  2. How much capital equipment can a small business deduct (section 179)?
  3. Estate Planning - How much does an estate have to have before any tax is incurred?
  4. Where are the tax bracket breaks ?
  5. What type of entity or business formation should I use ?
  6. Where can I get a form (non-tax) ? 
  7. Where can I get a state or federal tax form? 
  8. How long should I keep a particular document or record?
  9. How can I find out if a contribution to a organization can be considered as a charitable deduction? 
  10. Now that you know what organizations qualify for a charitable donation, what about the non-cash contributions. How do you determine the value?

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1. What is the automobile mileage rate?

2006 2007 2008 Jan-Jun 2008 Jul-Dec 2009
Business 44.5 48.5 50.5 58.5 55.0
Medical 18.0 20.0 19.0 27.0 24.0
Charitable 14.0 14.0 14.0 14.0 14.0
Moving 18.0 20.0 19.0 27.0 24.0
Authority Rev.Proc. 2005-78 Rev.Proc. 2006-49 Rev.Proc.2007-70 IR-2008-82 Rev.Proc. 2008-72
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2. How much capital equipment can a small business deduct (section 179)?

Maximum expense deduction for tax years beginning in:

2002 $ 24,000
2003 100,000
2004 102,000
2005 105,000
2006 108,000
2007 125,000
2008 250,000
2009 133,000
2010 25,000
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3. Estate Planning - How much does an estate have to have before any tax is incurred? 

 

  2000 ...........................        675,000.

  2001 ...........................        675,000.

  2002 ...........................     1,000,000.

  2003 ...........................     1,000,000.

2004 & 2005    ..............    1,500,000.

2006 ..............................   2,000,000.

 

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4. Where are the tax bracket breaks ?

YEAR 2008

Single

Taxable amount

over      but not over

Pay

 

plus % on excess of the amount  over   - 
$        0  -  8,025 $             0  10% $           0
 8,025  -  32,550 802.50 15% 8,025
 32,550  -  78,850 4,481.25 25% 32,550
78,850  -  164,550 16,056.25 28% 78,850
164,550  - 357,700 40,052.25 33% 164,550
357,700  -  ........... 103,791.75 35% 357,700

       

YEAR 2008

Married filing joint

Taxable amount

 over     but not over

Pay

 

plus % on excess of the amount over     - 
$       0    -    16,050 $             0  10% $          0
 16,050  -  65,100 1,605.00 15% 16,050
65,100  -  131,450 8,962.50 25% 65,100
131,450 -  200,300 25,550.00 28% 131,450
200,300  -  357,700 44,828.00 33% 200,300
357,700  -  ........... 96,770.00 35% 357,700
       

 

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5. What type of entity or business formation should I use ?

Like so many tax questions the answer is it depends. There is no one answer to this question. The type of entity depends on all the facts and circumstances surrounding your particular business and your plans for that business. There are several to choose from and not all make sense for everybody. 

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6. Where can I get a form (non-tax) or checklist?

Check out the following web site for numerous non-tax forms and several important checklists.   http://1040tools.com/html/forms_checklists.htm

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7. Where can I get a state or federal tax form?

Call me, I have thousands. The chances are I have the form you need.

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8. How long should I keep a particular document or record?

This is the same answer as number 6 above. Visit http://1040tools.com/html/forms_checklists.htm among the numerous forms is a records retention policy near the bottom under "checklists"

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9. How can I find out if a contribution to a organization can be considered as a charitable deduction? 

You can visit a web site maintained by the IRS to see if an organization qualifies for a section 170(c) deduction. Follow the "Search Now" link and enter the name of the organization you are trying to verify. This information is contained in IRS Publication 78.  Generally the donation must be to a charitable organization. Ask the organization for a copy of the determination letter they received from the IRS. Donations to individuals are gifts, not a charitable donation. Be sure to get a written receipt from the organization for all donations of $250 or more. 

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10.    Now that you know what organizations qualify for a charitable donation, what about the non-cash contributions. How do you determine the value?

The amount that can be deducted on Schedule A for non-cash donations equals the fair market value (FMV) of the item(s) donated. A couple of web sites that assist in determining the FMV are:         Salvation Army   and   www.itsdeductible.com This organization sells software that includes the FMV of items.  

Another good practice to get into when donating non-cash items is to take a picture of the items. Keep the picture(s) with that years tax records. 

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Revised: January 06, 2009 .

 

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Last modified: August 26, 2004