* Deductible as miscellaneous itemized deductions to the extent the total exceeds 2% of AGI
** Deductible to the extent the total of all medical and dental expenses exceeds 7.5% of AGI
©2008, American Institute of Certified Public Accountants
Tax tips - Filing basics
ROTH CPA & ASSOCIATES, LLC
10751 Montgomery Road
Cincinnati, OH 45242
513-530-9000
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Business Tax Deductions
¨ Retirement Contributions
¨ Moving Expenses
¨ Tradeshow Exhibitions
¨ Licenses and Fees
¨ Depreciation
¨ Bank Charges
¨ Purchase of Equipment
¨ Interest and Fees on Debts
¨ Auto Expenses
- Mileage or Actual Cost
- Purchase of a Vehicle
- Lease Payments
¨ Professional Fees
- Legal Services
- Accounting
- Business Consulting
¨ Deductions
Even if you don’t itemize, the following deductions may be available to you: traditional IRA, SEP and qualified plan contributions; one-half of self-employment tax; alimony; job-related moving expenses; and self-employed health insurance premiums. In addition to above-the-line deductions, you can claim the standard deduction or itemize. The basic standard deduction for 2008 is $5,450 if single or married filing separately; $10,900 for married filing jointly or qualifying widow(er); and $8,000 for head of household. Taxpayers 65 and older and/or blind get an additional standard deduction of $1,050 for married filing jointly or separately and $1,300 for single or head of household. You should itemize if your total allowable itemized deductions are more than the standard deduction. Keep in mind that the value of some of your itemized deductions will be reduced if your AGI is above $159,950 ($79,975 if married, filing separately). This reduction is being phased out until it is eliminated in 2010, and the reduction for 2008 will be lower than it was last year.
Individual Tax Deductions
¨ Student loan interest
¨ Penalty for early withdrawal of savings
¨ Alimony
¨ Charitable contributions — cash, property and donated clothing or household items
¨ State and local income taxes and personal property taxes
¨ Points paid for mortgage or refinancing
¨ Mileage and other expenses associated with volunteer work
¨ One-half of self-employment tax
¨ Unreimbursed casualty and theft losses
¨ Income tax preparation software and fees*
¨ Job-search expenses*
¨ Investment expenses*
¨ Unreimbursed employee business expenses*
¨ Prescription eyeglasses, contacts and hearing aids**
¨ Crutches, canes and orthopedic shoes**
¨ Medical transportation**
¨ Cost of alcohol or drug abuse treatment**
¨ Filing Status
Taxpayers can file as single, married filing jointly, married
filing separately, head of household, or qualifying widow(er). If you are married and filing jointly, you can take advantage of tax credits and benefits not available to couples filing separately. Unmarried taxpayers may file as single or, if they qualify, as head of household.
¨ Exemptions
You may claim a personal exemption for yourself, your spouse
and each of your dependents. Each exemption reduces your taxable income by $3,500 in 2008. You begin to lose part of the exemption benefit if your adjusted gross income (AGI) is above the following:
2008 Exemption Phase-Out Limits
• Single - $159,950 up to $282,450
• Married filing jointly/Qualifying widow(er) - $239,950 up to $362,450
• Married filing separately - $119,975 up to $181,225
• Head of household - $199,950 up to $322,450
For 2008, even with AGI’s in excess of the phase-out maximum, you still may take a $2,333 personal exemption. The good news is that the personal exemption reduction is being phased out and will be fully repealed by 2010.
Filing Basics
Tax Planning 2008
Filing Basics
Homeowner Tax Breaks
Retirement Savings Tax Breaks
Child and Education Tax Breaks
Investment Tax Tips
Recent Tax Law Changes
IRS Tax Tips
ROTH CPA & ASSOCIATES, LLC
10751 MONTGOMERY ROAD
CINCINNATI, OH 45242