Tax news and guidance for individual taxpayers — filing tips, deductions, refunds, and everything else that hits your personal return.
Of course, the most common changes for any tax year are items which are indexed for inflation. For 2006, this includes: Personal exemptions are increased to $3,300. Standard deductions are increased to $10,300 for married couples filing a joint return and qualifying widow(er)s; $5,150 for singles and married individuals filing separate returns; and $7,550 for heads…
For tax year 2006, the alternative minimum tax (the dreaded AMT) exemption rises to $62,500 for a married couple filing a joint return and to $42,500 for single persons and heads of household. Don’t get too excited, though, as those amounts are slated to drop in 2007.
Mileage rates. I got to it, okay? Yes, this is #1 question I’ve been asked for the 2006 tax year. Take a deep breath. Here are the rates: The standard mileage rate for business use of a car, van, pick-up or panel truck is 44.5 cents per mile. The standard mileage rate for the cost…
Prior to 2006, children under the age of 14 who have unearned income (dividends and interest) over $1600 and are claimed as dependents must be taxed at their parent’s rates – this is the so-called “kiddie tax”. For 2006, the age has increased to dependents who have reached age 18 (yes, this means that emancipated…
Believe it or not, members of the military often get overlooked when our legislature is crafting new tax laws. And sometimes, it takes a bit to get it right. For 2006, the legislature finally fixed some problem issues for our military. For one, military members serving in Iraq, Afghanistan and other combat zone localities can…
One of the most important tax changes for 2006 is the increase in the contribution limit for Roth and traditional IRAs rises for those taxpayers who are aged 50 or more. The increase is more than 10% from $4,500 to $5,000. But if you’re under age 50, sorry, the contribution limits remain the same. Even…
Tax day is just a month or so away… If you haven’t figured it out by now, there are some changes for tax year 2006. Check ’em out: A 10% credit can be claimed for various energy-saving improvements made to your main home. The credit is based on the cost of new energy-efficient improvements including…
A little snow never hurt anybody. A lot of snow? That’s a whole other story. The IRS has announced that farmers and fishermen may request a waiver of estimated tax penalties if they were affected by the snowstorms that began on February 19, 2007. The reason? The magnitude of the storms may have affected the ability of many farmers…
Taxpayer asks: Hey there! I found your blog entirely through random surfing, and it’s perfect for a question I have right now.I’ve returned to being a full-time student, after several years of working in the real world. Last year, my income was a big, even 0. I had simply no taxable income. The IRS seems…
Taxpayer asks: I just got married to my beautiful wife who happens to be Australian. I’m a graduate student in San Diego and she hasn’t come to live with me yet. My wedding was on December 27th so I’m wondering if it is somehow illegal for me to file my taxes as unmarried. She has never made…