Kiddie Tax
Children who are 18 years old or a full time student and under age 24 with unearned income in excess of $1,700 is taxed at the parent's rate.
Energy -Saving Tax Incentives extended through 2008
The maximum amountof credit for all improvements is $500.
Energy savings home improvements include replacement of windows,doors, roofing and certain high efficiency heating and cooling equipment. The credit apploes to improvements made to your primary residence from January 1,2006 through December 2007.
Catch-up Pension Contributions
If you getting close to retirement you may want to consider increasing your pension contribution. Taxpayers who are at least 50 years of age may make additional catch up Individual Retirement Account and 401(k) contributions. The maximum contribution limit that may normally be made is increased by $2,500 in 2007 and 2008.
Personal Exemption
Personal Exemption amount increased from $3,300 to $3,400 in 2007.
Standard Deduction
Standard deduction amounts increased for 2007
Single or Married Filing Separate $5,350
Married filing Joint or Qualifying Widow $10,700
Head of Household $7,850.
Depreciation and Section 179 Deduction
The maximum section 179 deduction you can elect for qualified section 179 property placed in service in 2007 has increased to $125,000. This limit is reduced by the amount by which the cost of qualified property placed in service during the tax year exceeds $500,000.
For 2008 only, the Section 179 deduction is increased to the following amounts:
Expense Limit.................................................................................................. $250,000
SUV Expense Limit...........................................................................................$25,000
Deduction phase-out begins when investment in Sec.179 property exceeds...$800,000
Unless Congress extends the limits again, the 2009 Section 179 expense limit will go back to $125,000, adjusted for inflation, and the investment limit will go back to $500,000, adjusted for inflation.
