July, 2008

New Standard Mileage Rate

Go get the mileage from your car. Do it today. Do it now. I’ll wait…..

If you’re a tax client, feel free to e-mail me a list of vehicles and the mileage. One less thing for you to try to find six months after the fact.

Since gas appears to be $5/gallon now, the IRS has increased the standard mileage rate from $0.505/mile to $0.585/mile starting July 1, 2008. So you need to be sure you’re keeping track of your business mileage. You need to keep track of mileage even if you’ll be using the “actual” expenses method because you have to split expenses between business and personal.

Of course, if you had the nifty Tax Buddha Mileage Log, you’d already be writing down your mileage. It’s a ‘free gift’ with the 8 Fold Path to Pay Less Tax and Avoid an Audit, our new product for business owners. We’ll be selling additional mileage logs separately at cost, just as soon as we can get them printed. Request yours today!

Employer provided Vehicle can use Cents-Per-Mile if under $15,000

If your corporation provides a vehicle for employees who drive at least a bit personally, this is income to the employee. (If we get the choice, we’d prefer the employee owns the vehicle and submits monthly expense reports for reimbursement.)

The question for the employer has been how to value the personal use portion. The IRS says that for 2008, you can use the cents per mile method ($0.505/mile for Jan-June, $0.585 July-Dec for ’08) IF the vehicle value does not exceed $15,000 when the employee starts using it. ($15,900 for the ‘step up’ sized vehicle, like a Chevy Suburban). You can read more about this in Publication 15-B, Employers Tax Guide to Fringe Benefits (page 20) http://www.irs.gov/pub/irs-pdf/p15b.pdf. Otherwise, you may need to determine actual expense.

Classes – Basic Payroll and Schedule C

In conjunction with the IRS and EDD, Andy's going to be doing some Basic Payroll seminars coming up in the near future.

Basic Payroll: Seminar runs 9 am – 3 pm with an hour for lunch

The next seminar will be

Basic Payroll in Oakland at Elihu M. Harris State
August 6th http://www.edd.ca.gov/Payroll_Tax_Seminars/Reserve_Space.asp?SemID=3134
September 10th http://www.edd.ca.gov/Payroll_Tax_Seminars/Reserve_Space.asp?SemID=3135

Basic Payroll in San Rafael is presented at 120 North Redwood Drive, 2nd floor, Redwood Room East Wing, Room E-212 on
October 22nd http://www.edd.ca.gov/Payroll_Tax_Seminars/Reserve_Space.asp?SemID=3147

These seminars have proven to be very popular, plus they’re free.

How to Prepare your Own Schedule C
Prepare your business taxes for ’07 and get ready for ‘08. Review what the IRS wants to know from you and how to report it on the Schedule C for your business. This is a class for business owners who need a basic understanding of their 1040 Schedule C tax forms. We’ll also talk about what to do with the numbers once you have them. We can’t guarantee you won’t get audited, but this class will make it less likely.

Andy will be at the US Small Business Administration offices in San Francisco at 455 Market Street, 6th Floor July 14th, 6-8:30 pm. This class will be free. http://web.sba.gov/calendar/public/index.cfm?op=group&grp=13

For the Tax Professional – Basis and Auto Expenses

A new class “Basis” is scheduled for Saturday, July 12h for 4 hours of CPE in Lafayette, 9 am to 1 pm. We’ll try to be at the same address as last November’s S Corp class at 100 Lafayette Circle, but we’re exploring a larger room on the second floor of the same building. Look for our Tax Buddha sandwich board sign (space is limited, so sign up early!). Sign up sheet is at http://www.taxbuddha.com/basis/

Cost will be $100 and we’ll cover basic principles of Basis and apply them to examples such as Auto trade-ins and 1031 real estate exchanges. An order form is available by request, and should be posted to the web site by mid-June. E-mail with the subject “Basis” for an order form.

Employer/Employee Auto Expenses will be presented at a dinner meeting of CSTC in South San Francisco July 2nd at 8 pm after the dinner meeting. Look for more info at http://cstcsfbay.com/Edu.aspx Cost for non-members is $42

S-Corporations Part 1: Getting in and Staying in, along with the NEW Part 2: Staying in and Getting Out are scheduled for November in Lafayette, dates and location yet to be determined.

For relaxation and Clear Thinking: On The Spot

To carry you through the summer, we recommend meditation and that you check out On The Spot Massage at http://www.onthespotmassage.com/corporate.html to help you relax. A relaxed mind is a clear thinking mind. Makes an excellent gift for your tax preparer or other important person in your life.

The Next Product

“The 8-Fold Path to Paying Less Tax and Avoid an Audit” is a booklet for people already in business who need to know what they need to know to stay out of trouble while maximizing their after-tax profit.

We’re finalizing the text now, getting ready for the printer.

New Phone and Fax Numbers

We have moved our office to a shared commercial space in Alameda (the Berkeley address is a PMB) and have new numbers. The old numbers still forward, but AT&T gets a fee for each call forwarded. New numbers are:
Phone (510) 522-2300
Fax (510) 522-2307