Now that we're into 2008, business owners should be aware of several tax changes for the new year that will affect your finances when it comes time to file your 2008 taxes.
- the social security taxable wage base is now $102,000 (versus $97,500 for 2007)
- the maximum deductible limit for IRA's (traditional or ROTH) is now $5,000 (up a thousand from 2007)
- the business mileage deduction is now 50.5 cents per mile (up two cents per mile from 2007)
- the standard deduction has increased – for married filing jointly it is now $10,900 and for single/married filing separate it is $5,450 (a slight increase of $200 and $100 respectively)
- the personal exemption is now $3,500, up a hundred dollars; and
- the annual exclusion for gifts given remains the same as last year at $12,000
Knowing these changes now may help you take full advantage of them during the year. If you are aware of other tax issues that affect you every year, check the IRS web site at IRS.gov to see if there has been a change or consult with your CPA.