On the Format tab, click the Expander icon to open the Paragraph dialog. Both the Left and Right Indentation should be set to 0 (zero). To check or adjust the margins in Outlook 2010 and up, you need to look at the Paragraph settings and Page Setup. It's better to adjust the width of the compose window if you need to make the lines shorter and easier to read while composing messages.
Trying to force line lengths using margins or the Enter key to break lines only results in readability problems for the recipient. Outlook doesn't have an option to set the width of a message - it uses the full width of the message window and wraps text in the window as needed. If the recipient opens the message in a window 500 pts wide, the message would be indented 200 pts from the right edge. As set in this screenshot, the right margin is approximately 200 pts. Recommended setting: keep the right margin triangle at or very near the right edge of the page (identified by red arrow).