Dollars & Sense
It's Tax Time Again!
Itâ€™s Tax Time again. It isnâ€™t exactly everybodyâ€™s favorite time of year. But now is the time to get started on your paperwork so you have time to file a tax return by April 15.
If the prospect of dealing with a yearâ€™s worth of settlements, receipts, credit card statements and the like is just too over whelming, fear not, you can send it to your accountant to summarize. Donâ€™t have an accountant? Well then, you can send it to us. If you are on our bookkeeping service, then we already would have your profit and loss statement for your business.
If youâ€™re self-employed your income will be reported to the IRS on 1099â€™s and mailed out to you by January 31. Itâ€™s always a good idea to double check the amount reported on the 1099 against your own records. Youâ€™d be surprised at how many times these totals donâ€™t match. You will need to contact your tax preparer for advice on how to handle discrepancies.
The best way to get started is by getting together all your income and expense records for 2008 for your accountant. If youâ€™re handling it yourself add up the totals for the year breaking down your expenses by category. When gathering expense information be sure to include all checks written, credit card charges, cash expenses and any expenses reflected on your settlement statements.
Expenses should then be broken down by category, such as, fuel, maintenance/repairs, tires, tolls/scales, cell phone, etc. Total all the expenses for each category for the year. Most tax preparers send out some type of tax worksheet or tax organizer to help you gather and sort your tax information. For a free tax organizer you are welcome to contact our office.
WHAT DO YOU NEED?
Listed below are items needed for your income tax preparation. If you have not received these items by the first week in February, you should contact your employers or financial institutions to find out where they are or to request duplicates.
Items you should receive by early February:
1. W-2â€™s from employers
2. 1099â€™s from all companies and/or individuals youâ€™ve done work for - brokers, motor carriers, independent businesses, etc.
3. 1099â€™s or end of year statements from banks for interest and dividend income, brokers for stock information, mutual funds, 401K and IRA distributions, and mortgage interest statements.
4. W-2P or 1099R for pension and annuity income.
5. 1099â€™s and year end statements for unemployment compensation, social
security income and state tax refund.
Here are a few other things youâ€™ll need to get together:
1. Contracts for the purchase and/or sale of equipment.
2. Escrow statements for the purchase, sale or refinance of property.
3. Confirmations from charities for donations in excess of $250.
4. Number of overnights for per diem.
5. Number of business miles on personal vehicle.
6. Schedule K1 if you are involved in any partnerships or s-corporations.
Remember, if you have employees or independent contractors you are also required to send out your W-2â€™s and 1099â€™s by January 31 as well. This includes self-employed individuals that have hired their children to do work for their business. You must issue W-2â€™s to your children to get the deduction.
Business Mileage Rate
Business mileage rate increased to 50.5 cents for all business miles starting January 1, 2008 through June 30, 2008 and beginning July 1, 2008 it is 58.5 cents per mile.
The per diem amount remains at $52 per day and is 80% deductible for transportation workers.
This article has been presented by PBS Tax & Bookkeeping Service, a company which has been providing income tax and bookkeeping services to the trucking industry for over a quarter century. If you would like further information, please contact us at 800-697-5153. Visit our Web Site at www.pbstax.com.
Everyoneâ€™s financial situation is different. This article does not give and is not intended to give specific accounting and/or tax advice. Please consult with your own tax or accounting professional.