NEW 2006 TAX LAWS

• The Kiddie Tax has expanded, the old rule meantthat some of the unearned income of a child wastaxed at the parent's rate until they reached the ageof 14. The new law has expanded that age to 18 and is retroactive to January 1, 2006. Something we need to watch out for.
  
  
• Personal exemptions have increased to $3,300 each.* The 2006 standard mileage rates are 44.5 cents forbusiness travel, 18 cents for medical and moving, and14 cents for charitable purposes.
  
  
• IRS is getting tough on charitable deductions. Nowall cash contributions require either a cancelled checkor receipt. No more estimating! If you give donationsof clothing or household items, they must now be ingood or better condition.
  
  
• The reduced capital gain and dividend rates of 5% and 15% were to expire soon, however, those rates havebeen extended through the year of 2010.
  
  
• The 3% telephone excise tax has been repealed andtaxpayers will receive a standard credit on their 2006 returns. You may receive a higher credit if youprovide telephone receipts showing the actual tax paid.