Important Changes for 2001

The following are some of the tax changes for 2001. For information on other changes, see Publication 553, Highlights of 2001 Tax Changes.

Self-employment tax. The maximum net self-employment earnings subject to the social security part (12.4%) of the self-employment tax increased to $80,400 for 2001. For more information, see Self-Employment Tax in chapter 1.

Standard mileage rate. The standard mileage rate for the cost of operating your car, van, pickup, or panel truck in 2001 is 34 1/2 cents a mile for all business miles. See Car and Truck Expenses in chapter 8.

Third party designee. Beginning with your tax return for 2001, you can check the "Yes" box in the "Third Party Designee" area of your return to authorize the IRS to discuss your return with a friend, family member, or any other person you choose. This allows the IRS to call the person you identified as your designee to ask any questions that may arise during the processing of your return. It also allows your designee to perform certain actions. See your income tax package for details.

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