Latest News

IRS sets mileage rates for 2012. The business rate remains 55.5 cents/mile, the medical/moving rate drops to 23 cents/mile, and the charitable rate remains at 14 cents/mile.

For 07/01/2011 through 12/31/2011 the mileage rates are 55.5 cents/mile for business, 23.5 cents/mile for medical/moving, and 14 cents/mile for charitable purposes.

For 01/01/2011 through 06/30/2011 the mileage rates are 51 cents/mile for business, 19 cents/mile for medical/moving, and 14 cents/mile for charitable purposes.
SKOWRONSKI & SKOWRONSKI, P.C.

Tips About Tips

Do you have an occupation, such as waitress, where tips are given in the normal course of business? If you do, you cannot consider these tips as non-taxable gifts; they must be included in your taxable income on your personal income tax return.

Keep the following in mind if you receive tips.

  1. Tips are taxable. Tips are subject to federal income, Social Security and Medicare taxes. The value of non–cash tips, such as tickets, passes or other items of value, is also income and subject to tax.
  2. Include tips on your tax return. You must include in gross income all cash tips you receive directly from customers, tips added to credit cards, and your share of any tips you receive under a tip–splitting arrangement with fellow employees.
  3. Report tips to your employer. If you receive $20 or more in tips in any one month, you should report all of your tips to your employer. Your employer is required to withhold federal income, Social Security and Medicare taxes.
  4. Keep a running daily log of your tip income. You can use IRS Publication 1244, Employee's Daily Record of Tips and Report to Employer, to record your tip income.