Tax information Chart for 2008 from Ann Arbor Commerce Bank

Wednesday, January 23, 2008

by admin

The following table provides some important tax information for 2008, compared with 2007. Notice you can pay your kids $1800 a year for helping out in your business

Social Security / Medicare	2008	2007
Social Security Taxable Wage Base	$102,000	$97,500
Medicare Taxable Wage Base	No limit	No limit
Individual Retirement Accounts	2008	2007
Roth IRA Individual, up to 100% of earned income	$5,000	$4,000
Traditional IRA Individual, up to 100% of earned Income	$5,000	$4,000
Roth and traditional IRA additional annual "catch-up" contributions for account owners age 50 and older	$1,000	$1,000
Annual Qualified Plan Limits	2008	2007
Defined Contribution Plan Dollar limit on additions on Sections 415(c)(1)(A)	$46,000	$45,000
Defined Benefit Plan limit on benefits (Section 415(b)(1)(A))	$185,000	$180,000
Maximum compensation used to determine contributions	$230,000	$225,000
401(k), SARSEP, 403(b) Plan Deferrals (Section 402(g)), & 457 Plan deferrals (Section 457(b)(2))	$15,500	$15,500
401(k), 403(b), 457 & SARSEP additional "catch-up" contributions for employees age 50 and older	$5,000	$5,000
SIMPLE deferrals (Section 408(p)(2)(A))	$10,500	$10,500
SIMPLE additional "catch-up" contributions for employees age 50 and older	$2,500	$2,500
Compensation defining highly compensated employee (Section 414(q)(1)(B))	$105,000	$100,000
Compensation defining key employee (officer)	$150,000	$145,000
Compensation triggering Simplified Employee Pension (SEP) contribution requirement (Section 408(k)(2)(c))	$500	$500
Driving Deductions	2008	2007
Business mileage, cents per mile	50.5	48.5
Charitable mileage, cents per mile	14	14
Medical and moving mileage, cents per mile	19	20
Business Equipment	2008	2007
Maximum Section 179 expense deduction	$128,000	$125,000
Phaseout for Section 179	$510,000	$500,000
Qualified Transportation Fringe Benefit Exclusion	2008	2007
Commuter highway vehicle and transit pass, per month	$115	$110
Qualified parking, per month	$220	$215
Domestic Employees	2008	2007
Annual threshold when a domestic employer is liable to withhold and pay FICA for babysitters, housekeepers, etc.	$1,600	$1,500
Standard Deduction	2008	2007
Married filing jointly	$10,900	$10,700
Single (and married filing separately)	$ 5,450	$ 5,350
Heads of Household	$ 8,000	$ 7,850
Itemized Deduction Phase-Out	2008	2007
Amount for all filing status categories except married filing separately	$159,950	$156,400
Married filing separately	$ 79,975	$ 78,200
Personal Exemption	2008	2007
Amount	$3,500	$3,400
Kiddie Tax	2008	2007
Net unearned income for an child that is not subject to the "kiddie tax"	$1,800	$1,700
Annual Exclusion for Gifts	2008	2007
Amount you can give to each recipient	$12,000	$12,000
IRS Interest Rates	2008 (1st quarter)	2007 (4th quarter)
Tax overpayments	7 percent (6 percent for corporations; 4.5 percent for the portion of corporate overpayments exdeeding $10,000)	8 percent (7 percent for corporations; 5.5 percent for the portion of corporate overpayents exceeding $10,000)
Tax underpayments	7 percent (10 percent for large corporate underpayments)	8 percent (10 percent for large corporate underpayments)