i have an '89 formula w/ 305 tbi. if driving at idle i stomp on the gas the engine seems to cut out and then a second later it will just take off, is this a timing problem? or maybe transmission? what do you think?

Well, the shift lag on the 700R4 is pretty bad, I mean, you get bucked foreward for a good full second before your transmission downshifts. It's supposed to happen. Shift kits will fix this.

what kind of shift kit would be the best for the money?

Trans-Go. Don't waste your money on a B&M or other "cheap" shift kits.

Agreed. TransGo makes your shifts faster and harder the right way...others give a somewhat Jerry-rigged approach.

from what you describe it has nothing ot do with the tranny, the tranny doesnt downshift from idle for one, and it wouldnt make the engine cut out

just noticed that you said driving at idle, not sitting. so it could be the tranny lag, but that still wouldnt make the engine cut out

sounds to me like its flooding for a second before it starts to rev up
mine does it a little bit to

when your at idle dont mash it to the floor, go halfway for a split second then go to the floor, see fo that works better

Check your tune-up again, man. Especially the cap and rotor button...

coulld also be your fuel pump is on it's way out. my car did this for a few months before it's fuel pump went out, new pump and the problem was gone.