Volume 5 December 1999

This is the year our firm grew large enough to merit incorporating and so we are venturing into a new millennium with a new outlook. Thanks to our friends and clients, our office continued to experience good growth this year. For the 4th tax year in a row our revenue and client base showed strong increases. An analysis of our new clients continues to reveal that the #1 source of new business comes via referrals from our friends and existing clients. THANK YOU!! We couldn’t do it without you. We can only be secure if we continue to grow. So, we are asking you to help us again. Please tell your friends and relatives about our good service. Tell them we do:

1. Income taxes-Personal and Business

2. Payroll taxes-State and Federal

3. Incorporation Service-New Business Start UD

4. Accounting-Bookkeeping

5. Financial Consulting

6. Business Consulting

1. The Child Tax Credit In 1999, the IRS now gives a $500 direct credit per child for children under 17. The credit begins to be phased out when joint income exceeds $110,000. Families with 3 or more children may receive a credit in excess of tax liability.

2. College Tuition & Expenses Credits are now in full swing for all expenses paid in 1999.

3. Interest on Student Loans. These expenses are now deductible up to $1,500

4. Tax on Recapture of Education credits. If you took an education credit in 1998 but later received tuition refund or tax free education assistance you may owe tax.

5. Education Individual Retirement Account. Are still available for $500/year.

6. Individual Retirement Accounts- IRAs. You can deduct IRA contributions even if you or your spouse is covered by a retirement plan provided you meet the income requirements.

7. Standard Mileage Rate for Business Use of Vehicle. The rate is $.325/mile before 4/1/99 and $.31/mile after 4/1/99.

8. self-Employed Health Insurance. 60 % of premiums are now deductible.

9. A stop smoking program is now a deductible medical expense. These will be added to your other medical costs.

 

1. If 1999 is expected to be an expensive tax year pay year 2000 deductible expenses before 12/31 and defer 1999 income till next year. Conversely if you expect a windfall in year 2000 reverse to actions described above.

2. Consider selling in 1999 stocks with losses to offset other gains already taken on 1999 sales of assets.

3. Pay Next years college tuition now.

4. Give to charity before year-end. Some charities will accept your used car and you can take a deduction for market value today.

5. Consider establishing a retirement plan if you are self-employed. Different plans have different rules so you should give us a call to discuss your particular situation.