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updated on: February 01, 2008 Health care information MUST be
included with 2007 Massachusetts tax returns. This includes:
The contribution to an HSA – Health Savings Account – is deductible up to $2,850 if you are single and $5,650 if you are married. An additional $800 can be contributed if you are 55 or older. Funds withdrawn from the HSA to pay medical bills are not treated as taxable income. Also, you can fund your HSA with IRA money. If you are over 70, you can make contributions of up to $100,000 directly from your IRA to a qualified charity – or consider donating appreciated stock. The IRS states that for a charitable contribution of $250 or more, you can claim a deduction only if you obtain a written acknowledgment from the qualified organization. The home energy credit ends January 1, 2008. The qualified
energy efficiency improvements are: For 2007, your 401(k) plan at work will max out at $15,500 - $20,500 if you are 50 or older. Gifts to family or others will be tax-free up to $12,000 per donee for 2007. The age limit for the “kiddie tax” – the taxing of a child’s interest and dividends above a certain amount at the parents’ higher rate – is increased to age 19 or 24 if the child is a student. We are still waiting on the Senate bill to eliminate the Alternative Minimum Tax for taxpayers earning less than $500,000 a year.
Important reminder: We must have all your tax information by March 20th, in order to guarantee an April 15th filing. The IRS prefers electronically
filed tax returns.
What do Elvis Presley and you have in common? Absolutely nothing, you're probably thinking. But if your estate plan isn't in order, you may have the same problem he had before he died in 1977 at the age of 42. At his death, his estate was valued at over $10 million, but federal estate taxes and other estate settlement costs of more than $7 million reduced its net value to under $3 million. With a more carefully prepared estate plan, Elvis might have been able to leave more to his daughter and other family members, and less to the federal government. When Jessica Savitch, the NBC news anchor, died in a car accident in 1983, her gross estate was just over $2 million. Had she done some basic estate planning, however, she might have escaped estate taxes that diminished her estate by 51 percent. Whether you are a celebrity or just an ordinary, hard-working entrepreneur, the lesson is the same: careful estate planning can make a big difference in how much you leave to your future heirs. Estate planning techniques range from the straightforward to the complex, but you don't have to be a millionaire to take advantage of them. For more information, contact John Galego.
Just for fun: The most unpopular tax in the history of the United States of America was the “tea tax”. This lead directly to the “Boston Tea Party”. In Missouri in 1820, there was a $1.00 tax levied against bachelors from age 21 to 50. The first income tax in the United States of America
was levied in 1861 to help finance the massive cost of the Civil
War. This tax was When this first federal income tax came into being,
Abraham Lincoln In 1894, the United States Congress imposed an income tax. This was in response to complaints that excessive reliance on tariffs as a revenue source pushed up costs of imported goods for farmers and other consumers. In 1895, The Supreme Court held that the 1894 income
tax law
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