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Standard Mileage Rate
For 2004, the standard mileage rate for the cost of operating your car, van, pickup, or panel truck is increased to 37.5 cents a mile for all business miles.
Acquisition
The purchase of one corporation by another, through either the purchase of its shares, or the purchase of its assets.
Depreciation and Section 179 Expense
50% special depreciation allowance. For qualified property you acquire after May 5, 2003, you can take a special depreciation allowance that is equal to 50% of the property's depreciable basis. However, instead of claiming the 50% special allowance, you can elect to claim the 30% special allowance or elect not to claim any special allowance.
Federal income tax
The federal government levies a tax on personal income. The federal income tax provides for national programs such as defense, foreign affairs, law enforcement, and interest on the national debt.
Earned Income Credit
A tax credit for certain people who work, meet certain requirements, and have earned income under a specified limit.
Form W-4, Employee's Withholding Allowance Certificate
Completed by the employee and used by the employer to determine the amount of income tax to withhold.
Dependent
A person, other than the taxpayer or spouse, who entitles the taxpayer to claim a dependency exemption.
Exemptions
Amount that taxpayers can claim for themselves, their spouses, and eligible dependents. There are two types of exemptions-personal and dependency. Each exemption reduces the income subject to tax. The exemption amount is a set amount that changes from year to year.
Employee
Works for an employer. Employers can control when, where, and how the employee performs the work.
Meal Expense Deduction
Generally, you can deduct only 50% of your business-re-lated meal expenses while traveling away from your tax home for business purposes. Also, you can generally deduct only 50% of certain reimbursements you make to your employees for meal expenses they incur while traveling away from home on business.
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Did You Know?