Tax question

[Jay Sherman]

I guess this counts as a journalism topic. If not, feel free to move this to the correct forum. Anyway, I spoke to an accountant buddy asking about the mileage writeoffs for filing my taxes. My paper pays $0.23/mile and the IRS rate is $0.58/mile. Right now, that's about a $1,300 difference, which is pretty big to someone who makes somewhere in the low-$20s.

He said the following: "It would be part of your itemized deductions subject to a 2% reduction based on your adjusted gross income. Considering you're just out of school, you probably won't get a dime back because you likely don't have enough itemized deductions to overcome the standard deduction."

Then he said: "Your standard deduction for 2008 is 5,350. So figure your donations + this amount + the amount of state taxes is > 5,350. For the record, many people who don't own a home file the standard deduction. There are other business expenses that could be unreimbursed employee expenses, not just mileage."

So journos, am I SOL come April, or were you able to get the deductions? And if so, how? BTW, I know this is a very premature question, I'm just curious as I'm looking at the mileage and wondering what could have been if I had an extra $1,300 in my pocket.

 

[Appgrad05]

You're still getting it. It's just included in that standard deduction.

 

[spnited]

You're not SOL... you will take a standard deduction of $5,350 which covers these type of things. If you can itemize more than $5,350, then itemize, which I can all but guarantee you can't.

 

[Ace]

Um. Even if you could write off the $1,300, it wouldn't be $1,300 in your pocket, it would mean you don't pay taxes on that amount, which would put a couple hundred bucks in your pocket.

If you really want to claim it, I guess you could donate a whole lot of money between now and Jan. 1.

 

[mike311gd]

Is the Ace Foundation up and running yet?

 

[SF_Express]

As they said: In your age and in your situation, you won't be able to itemize, and you'll be getting the "mileage" as part of the standard deduction.

 

[Ace]

Is the Ace Foundation up and running yet?

Give me 10 minutes.

 

[Editude]

Many people think saying something is "deductible" means just that. Actually, unless thresholds are met based on your filing status, most items are not. And forget medical, which needs an amount more than 7.5 percent of your AGI to even start being deducted.

 

[DemoChristian]

Medical is a joke. We couldn't claim it the year we had a baby because the standard is so high.

 

[mike311gd]

Is the Ace Foundation up and running yet?

Give me 10 minutes.

For you, I'll give you 15.

 

[Clerk Typist]

Form 2106. Unreimbursed business expense. Separate from the standard deduction. Also covers employment-related education, I believe.

 

[spnited]

Form 2106. Unreimbursed business expense. Separate from the standard deduction. Also covers employment-related education, I believe.

Wrong Clerk.
Still has to exceed 2% of AGI and then be transferred to Sched A if you are able to itemize.

 

[Jay Sherman]

I know it doesn't mean $1,300 in my pocket. I was referring to the $1,300 that I wish was in my pocket if I got the IRS mileage rate. Can anybody break this down to me like you would explain it to a five-year old? I'm filing taxes for the first time on my own (yay adulthood!).

 

[mustangj17]

I know it doesn't mean $1,300 in my pocket. I was referring to the $1,300 that I wish was in my pocket if I got the IRS mileage rate. Can anybody break this down to me like you would explain it to a five-year old? I'm filing taxes for the first time on my own (yay adulthood!).

I could explain it if you were strictly a freelancer or a contract worker. We've talked before so I know you have a full-time gig so I can't really explain it based on that.

 

[Hillman]

For anyone who prepares their own tax return, I recommend spendiing $20 for Turbotax or the H & R Block software program.

Those programs assist greatly in making certain everything goes on the right line. They can be annoying the first time through, but a little practice makes it easy.

It's a lot cheaper than paying a tax service 50 bucks or more for a fairly simply return.