Personal Tax Credits for the Purchase of Residential Energy-Efficient Property — A non-business credit of up to $500 is available for certain energy-efficient improvements, such as insulation, or exterior doors and windows. Taxpayers who install photovoltaic heating systems, qualified solar water heating, and qualified fuel cell systems are eligible for the residential energy efficient credit, which is applied to 30 percent of the amount paid (with certain limits).

Reduced Rates on Capital Gains and Qualified Dividends — Long-term capital gains and qualified dividends are taxed at a maximum rate of 15 percent. The improved stock market this year may mean more gains for some investors. The reduced rates were extended through 2010.

Increased Individual Alternative Minimum Tax (AMT) Exemption Amount —
A new law made moved up the AMT exemption to $42,500 ($62,550 for married couples filing jointly) for 2006. The AMT is expected to ensnare about 3.6 million taxpayers this year. You may have to pay the AMT if you have a large number of personal exemptions, a large sum of state and local taxes, itemized deductions, deductible medical expenses, stock options and large capital gains. The IRS “AMT Assistant” can be found at http://apps.irs.gov/app/amt/index.jsp?ck.

Elda Di Re, tax partner with Ernst & Young told WCBS TV in New York: "If based upon your income and deductions you are in the AMT for this year, we are recommending, not pre-paying any real estate taxes before year-end, not making any estimated tax payments before year-end, and frankly, even for good deductions like charitable, you are probably better off saving them until next year.”

Charitable Donations — No longer deductible are contributions of clothing or household items made after August 17, 2006, unless the item is in “good used condition or better.” Money donated to charity after that date must be backed up by a bank record or written communication from the charity indicating the name of the charity, the date the donation was made and the amount of the contribution. Canceled checks, bank or credit union statements and credit card statements are all considered bank records. The deduction for a vehicle donated to charity is usually limited to the gross proceeds from its sale.

Telephone Excise Tax Refund — Last May the IRS announced a tax refund on long-distance or bundled-telephone excise taxes paid between Feb. 28, 2003, and Aug. 1, 2006. Applicants must fill out Form 8913, Credit For Federal Telephone Excise Tax Paid. The IRS has announced standard amounts to figure the refund. The amounts are based on the total number of exemptions claimed on the 2006 federal income tax return: $30 for a person filing a return with one exemption, $40 for two exemptions, $50 for three exemptions and $60 for four or more exemptions. See the IRS website for more information. http://www.irs.gov/newsroom/article/0,,id=164310,00.html

Alternative Motor Vehicle Credit —Various amounts of credit are available for the first 60,000 vehicles purchased of each qualified model. The number of cars that meet the qualifications has increased for 2006.

Remember that you can offer with the IRS to settle for a lower amount if you can’t pay your full tax bill. A new law allows partial payments while the agency considers the offer.

If you’re getting a refund, however, it’s a good idea to file early. It will mean a faster turnaround to get your check.

Richard Robinson , 05 January 2007 @ 20:07 PM  Charitable cash payments in 2006 The article states that cash payments to charities after 8/17/06 require written evidence. This is not true, the new law begins in 2007 for individuals. For 2006, only cash payments of $250 or more require written acknowledgement. Dick R., CPA, California

Jay Draiman , 04 January 2007 @ 07:22 AM  MANDATORY RENEWABLE ENERGY – THE ENERGY EVOLUTION –R3 MANDATORY RENEWABLE ENERGY – THE ENERGY EVOLUTION –R3 In order to insure energy and economic independence as well as better economic growth without being blackmailed by foreign countries, our country, the United States of America’s Utilization of Energy sources must change. "Energy drives our entire economy." We must protect it. "Let's face it, without energy the whole economy and economic society we have set up would come to a halt. So you want to have control over such an important resource that you need for your society and your economy." Our continued dependence on fossil fuels could and will lead to catastrophic consequences. The federal, state and local government should implement a mandatory renewable energy installation program for residential and commercial property on new construction and remodeling projects with the use of energy efficient material, mechanical systems, appliances, lighting, etc. The source of energy must by renewable energy such as Solar-Photovoltaic, Geothermal, Wind, Biofuels, etc. including utilizing water from lakes, rivers and oceans to circulate in cooling towers to produce air conditioning and the utilization of proper landscaping to reduce energy consumption. The implementation of mandatory renewable energy could be done on a gradual scale over the next 10 years. At the end of the 10 year period all construction and energy use in the structures throughout the United States must be 100% powered by renewable energy. In addition, the governments must impose laws, rules and regulations whereby the utility companies must comply with a fair “NET METERING” (the buying of excess generation from the consumer), including the promotion of research and production of “renewable energy technology” with various long term incentives and grants. The various foundations in existence should be used to contribute to this cause. A mandatory time table should also be established for the automobile industry to gradually produce an automobile powered by renewable energy. The American automobile industry is surely capable of accomplishing this task. TNorthridge, CA. 91325 1-3-2007