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Our records indicate that you have not used any vacation time over the past 100 year(s). As I'm sure you are aware, employees are granted 3 weeks of paid leave per year or pay in lieu of time off. One additional week is granted for every 5 years of service. Please either take 9,400 days off work or notify our office and your next pay check will reflect payment of $8,277,432.22 which will include all pay and interest for the past 1,200 months.

Sincerely,
Payroll Processing

Note: About the only good thing that could happen with a Y2K error. Thanks to my friend Edythe.

QuickBooks Pro 99, will debut on retail shelves in January and will allow users to import or export accounting data to Microsoft Word and Excel applications, sources said. "With this, you can run accounting data in Office and do an analysis on your payables," said a retail source, who asked to remain anonymous.

We are an authorized support center for QuickBooks. Call us if you have any problems or need software.

This press release is from Computer Retail Week.

TAX TIPS AND FACTS will appear on our World Wide Web page, at http://www.rak-1.com making it available the WORLD. Last month, 1,923 Internet surfers from 18 countries accessed our web page and read TAX TIPS AND FACTS on-line. Several of the readers asked to be added to the list to receive TAX TIP OF THE WEEK.

Meg was the name of my girlfriend...
And Gig was your middle finger upright...
Now they all mean different things
And that really mega bytes...

An application was for employment...
A program was a TV show...
A cursor used profanity...
A keyboard was a piano...
Memory was something that you lost with age...
A CD was a bank account...
And if you had a 3 1/2' floppy, you hoped nobody found out...

Compress was something you did to the garbage,
Not something you did to a file...
And if you unzipped anything in public
You'd be in jail for a while...

Log on was adding wood to the fire...
Hard drive was a long trip on the road...
A mouse pad was where a mouse lived...
And a backup happened to your commode...

Cut you did with a pocket knife...
Paste you did with glue...
A web was a spider's home...
And a virus was the flu...

I guess I'll stick to my pad and paper
And the memory in my head...
I hear nobody's been killed in a computer crash
But when it happens they wish they were dead.

Sent to me by Shirley and Phil. Thanks.

If your accountant isn't a Certified Public Accountant, think twice about where you are getting your advice. Who do you want handling your financial and business matters?

If your accountant isn't a CPA, it's time to seek professional help.

EDUCATION CREDITS.
The Hope credit and the lifetime learning credit are based on tuition and related fees paid for the taxpayer, spouse, or an eligible dependent. A taxpayer may claim only one education credit for each eligible student in a single tax year. The credits are not available for taxpayers with incomes above $50,000 ($100,000 for joint returns). Dependents and married persons who file separately, cannot claim the education credits. The Hope credit applies for only the first two years of post-secondary education. The maximum credit is $1,500, on tuition expenses of $2,000 or more. Both the payment and start of the related academic period must have been after 1997. The lifetime learning credit, which began July 1, 1998, is available for any level of higher education. The credit is 20 percent of the tuition paid for all eligible students, with an annual maximum credit of $1,000 per tax return.

STUDENT LOAN INTEREST DEDUCTION.
Taxpayers may deduct up to $1,000 of interest paid on a qualified student loan, but only during the first 60 months of the loan's repayment schedule. A taxpayer does not have to itemize deductions to claim this benefit, but cannot be claimed as a dependent, nor be a married person filing separately. The deduction is not available for those with incomes above $55,000 ($75,000, for a married couple filing jointly).

EDUCATION IRA.
Taxpayers may use this as a vehicle to save for college. The account beneficiary must be under age 18 when the contribution is made and the annual limit is $500 per beneficiary. The contribution is not deductible and is not reported on the donor's tax return. Earnings on the account are tax-deferred and will become tax-free if used for qualifying higher education expenses.

DEDUCTING IRA CONTRIBUTIONS.
Higher income limits for deducting IRA contributions apply to workers covered by an employer retirement plan: $40,000, $60,000 for a married person filing jointly. If only one spouse is covered by a plan, the other spouse may make deductible IRA contributions if their joint income is under $160,000.

ROTH IRA.
While taxpayers cannot deduct contributions to this retirement account, they will not have to pay taxes on withdrawals if it has been five years since they first opened a Roth IRA and they are age 59½ or the withdrawal is because of disability, death, or a first-time home purchase ($10,000 limit). A person may convert a traditional IRA to a Roth IRA without penalty, and include the taxable amount in that year's income as though it were a distribution. For conversions done in 1998, the taxpayer may spread the taxable amount equally over the four-year period 1998 through 2001.

CAPITAL GAINS TAX RATES.
The lowest maximum tax rates on capital gains now apply to assets held for more than one year, rather than 18 months. This shorter holding period applies to all assets sold in 1998. The rates are: 20% for most gains, but 10% for gains that would be in the 15% tax bracket; 25% for gains resulting from the depreciation of real estate; 28% for gains on collectibles and qualified small business stock. All taxpayers with capital gains will have to use Schedule D (Form 1040). They will no longer report capital gain distributions from mutual funds on Schedule B.

SALE OF RESIDENCE.
Taxpayers will not have to report the sale of a residence on their tax forms unless they had a taxable gain. If a person owned and used a home as a principal residence for two of the five years preceding the sale, up to $250,000 of gain may be excluded ($500,000 on a joint return). This tax break may be used only once every two years. A taxpayer who fails to meet the two-year residency requirement because of a change in health, employment, or unforeseen circumstances may prorate the maximum exclusion by the percent of the two-year requirement. This proration also applies for any person who had a residence on August 5, 1997, and sells it before August 5, 1999.

SELF-EMPLOYED HEALTH INSURANCE DEDUCTION.
Self-employed persons may deduct up to 45% of health insurance premiums for each month they weren't eligible to be a part of in an employer-sponsored health plan.

STANDARD MILEAGE RATES.
You may deduct 32½ cents a mile for all business miles driven, up one-cent from 1997. The rate for charitable contributions rose 2 cents, to 14 cents per mile. The rates for medical and moving expenses (10 cents per mile) are unchanged.

PAYMENT OF TAX DUE.
Taxpayers who are sending a check for their tax owed should make it payable to the United States Treasury, not the Internal Revenue Service, and should not staple the check to the tax return.

ESTIMATED TAX PENALTY.
There is generally no penalty if the balance due on the tax return is less than $1,000, including any household employment taxes.

Whether you're saving to buy a house, send your children to college or secure your retirement, you need a member of the Massachusetts Society of CPAs to assist you. Roger A. Kahan is an active member of the Massachusetts Society of CPAs.