I've seen more info on the 2006 chages, so I thought I'd update
and edit my original summary;


IRA limit stays at $4000, but the $500 catch-up provision
for 50+ goes to $1000.

401(k) limit goes from $14000 to $15000, 50+ catch-up goes
from $4000 to $5000.

Standard ded/exemption goes up to 10,300 Married, 7550 Head of
Household, 5150 single. (updated)

AMT exemption for couples goes from $58,000 down to $45,000,
God help me. (haven't seen this revoked)

Estate tax exemption goes from $1500000 in 2005 to $2000000
in 2006.

The gift tax exclusion goes up to $12,000 from $11,000 (new)

New tax rate schedules are listed at Fairmark.com (don't know
how well a table looks if posted here)

Roth 401(k) due to be introduced and embraced by those who
plan to retire in a high bracket.

JOE

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John H. Fisher wrote:

- quote -

A couple of points:

The change reflected in Jack's reply went into effect in
2005 and continues into 2006. The change to HOH has pluses
and minuses.

The big minus is the one that impacts your children who can
no longer meet the age requirement (under 19 or 24 if a
student) of a qualifying child. Prior to 2005 your child or
descendant of your child could qualify you for HOH
regardless of age and the child did not have to be your
dependent. Now, the child who fails the age test would have
to be your dependent.

One plus is that certain individuals who previously had to
be your dependent to qualify you for HOH, no longer have to
be your dependent if they meet the age test (e.g., siblings
and their descendants). Another plus is that a foster child
is now treated the same as your child (i.e., the full year
residency rule is repealed).

--
Alan
http://taxtopics.net

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JMc wrote:

- quote -

Now that would be an improvement. Currently an individual's
auto extension is four months, a corporation can get a six
month extension, while a partnership is limited to an auto
three months extension. Talk about inconsistency!

ChEAr$,
Harlan Lunsford, EA n LA

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One BIG change is in store for those who have formerly
qualified for head of household status (from my earliest
memory of over 40 years in practice)!! They may no
longer claim that status unless they have a qualifying
person whom they can claim as a dependent!!!=(:

It might be a good time time review all your clients
files to change the demographics of HOH's who no longer
qualify.

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- quote -

Two things I can think of (but one I am unsure of):

1) Section 199 - Domestic production deduction. Although,
NJ is beginning to complicate things by partially decoupling
from Section 199. This is probably not going to be as fun
as the bonus depreciation and Sec 179 expense decoupling,
but fun nonetheless.

2) Did I hear correctly that there will be only one form for
all extensions in the future, and that all extensions will
be 6 month extensions (No more filing 2 extensions for one
individual)?

Josh

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bncvtree wrote:

- quote -

What I know so far;

IRA limit stays at $4000, but the $500 catch-up provision
for 50+ goes to $1000.

401(k) limit goes from $14000 to $15000, 50+ catch-up goes
from $4000 to $5000.

Standard ded/exemption goes up don't know exact $$.

AMT exemption for couples goes from $58,000 down to $45,000,
God help me.

Estate tax exemption goes from $1500000 in 2005 to $2000000
in 2006.

I'm sure tax brackets are adjusted slightly for inflation,
haven't seen exact numbers.

Roth 401(k) due to be introduced and embraced by those who
plan to retire in a high bracket.

(I don't know if these are 'big', but SWMBO turns 50 next
year so her 401 deposit jumps from 14 to 20K, the AMT nails
us, and she's eyeing a pair of earings for me to celebrate
her big day. So next year is big for me.)

JOE

Moderator:
SWMBO is the acronym for "She Who Must Be Obeyed." So
help me God I would never state my wife's age in a public
forum. When asked for Susan's age, I and my son's always
reply "I don't know, but she looks 23." This is just one
tactic in my "Satisified Victims" program!

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"bncvtree" <jin007[at]hotmail-dot-com.no-spam.invalid> wrote:

- quote -

Who knows? Congress is not through meeting for this year.
Anything can happen between now and December 31, 2005
including changes in the tax law that can be made
retroactive back into years past.

Wayne Brasch

Moderator:
"No man's property is safe while Congress is in session."
-- Mark Twain (1891)

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2006 is an election year.
I would not be surprised to see a new deduction or two to
influence voters.

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Any big change next year?

Thanks.

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== >