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2009 Tax Changes Every Business Owner and Employee MUST Know
Written by: Merra Lee MoffittArticle Overview: Your money might go a little farther this year, thanks to new raised limitations of several common IRS deductions. Use this information to plan your savings and contributions and to take advantage of what good news there is going into 2009.
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2009 Tax Changes Every Business Owner and Employee MUST Know
Your money might go a little farther this year, thanks to new raised limitations of several common IRS deductions. Use this information to plan your savings and contributions and to take advantage of what good news there is going into 2009.
1. The maximum earnings subject to Social Security tax is now $106,800. The Social Security tax rate remains at 15.3%.
2. The maximum annual wage that someone under the normal retirement age can earn without a reduction of Social Security benefits is raised to $14,160.
3. The SSI COLA is 5.8% for payments beginning January 2009. Welcome relief in Medicare premiums is that these premiums will remain the same in 2009, now at $98.60.
4. The 15% marginal income tax rate begins at $16,700 taxable income for Married Filing Joint (MFJ) and $8,350 for single. The 25% marginal bracket begins at $67,900 MFJ and $33,950 single. The 28% marginal bracket begins at $137,050 MFJ and $82,250 single.
5. The personal exemption for 2004 is now $3,650. The standard deduction for Married Filing Joint (MFJ) is now $11,400 and $5,700 for single filers.
6. The business auto mileage deduction is now .58 cents per mile. In fact, that rate began July 1, 2008.
7. The child tax credit remains $1000 per child.
8. The long-term capital gains tax rate remains 15% if your marginal tax bracket is higher than 15%. It is 5% if your marginal tax bracket is 15% or lower. Qualifying dividends are now generally taxed at the same rate as long-term capital gains.
9. The Traditional IRA deductibility phase-out for MFJ has been raised to $65,000 to $75,000 and to $45,000 to $55,000 for Singles.
10. Eligibility phase out for Roth contribution begins at $105,000 for singles and for MFJ at $166,000. The Traditional and Roth IRA deduction maximums remain at $5000 with $1000 catch-up provision for age 50 and over.
11. The SIMPLE IRA deduction is now $11,500 with a catch-up provision of $2,500 for those 50 and over.
12. The 401K, 457,403(b) and SARSEP maximum contributions are now $16,500 with a catch-up increased from $5,500 to inflation-indexed if you are 50 or over.
13. The SEP IRA and Defined Contribution limits are now $49,000. The maximum salary that can be considered is $245,000.
14. Health Savings account maximum contributions for 2009 are now $5,950 for families and $2,300 for individual plans. Anyone age 55 or older can add an additional catch-up of $1000.
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- [quote:3shpwvxj]In fact, I've had friends tell me that "Founder" is better than "Owner" since it's less possessive.[/quote:3shpwvxj]
For myself, I don't care for the term "Founder" [i:3shpwvxj]because [/i:3shpwvxj]it's not possessive. You can be the founder of a company and have sold it - so it no longer belongs to you.
However, if you call yourself "Owner" - people know the company is still in your hands.
But I don't like Owner, either. I'd prefer President or Director, because one can be an absentee owner, whereas if one is a President or Director, people assume you're involved in the day to day activities.
Manager, on the other hand, wouldn't work if its your business, because (to me, anyway) that implies that you "manage" for someone else - like at a restaurant.
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- this is a fascinating book about the history of Business theory, and I'd recommend it to anybody.
2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto.
3. PADI: The Business of Diving Book
Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
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- I will be on vacation from Dec 23, 2008 - Jan 5, 2009 - See y'all in the New Year! Happy 2009 to All!!!
Post subject: It's Not Personal, just business
- I so agree! Actually, the business world as we know it IS in trouble. I heard some stats last week that they expect by the time 2050 that 70% of workers will be freelancers. Employee/Executive Bullying won't be able to stand it when it could be easier for someone to simply contract with the nicer guy (or gal). I, for one, will be choosing the nicer ones!
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- I have some queries about the working of the franchises. How does the relationship between the Store Owner, Suppliers and Corporate works exactly? How does the store owners get reimbursed when they sell commodities like coke in fewer prices than others?
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