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The following table provides some important tax information for 2007, compared with 2006. Save it as a handy planning reference.
| Social Security / Medicare |
2007 |
2006 |
| Social Security Taxable Wage Base |
$97,500 |
$94,200 |
| Medicare Taxable Wage Base |
No limit |
No limit |
| Individual Retirement Accounts |
2007 |
2006 |
| Roth IRA Individual, up to 100% of earned income |
$4,000 |
$4,000 |
| Traditional IRA Individual, up to 100% of earned Income |
$4,000 |
$4,000 |
|
Roth and traditional IRA additional annual "catch-up" contributions for account owners age 50 and older |
$1,000 |
$1,000 |
| Annual Qualified Plan Limits |
2007 |
2006 |
|
Defined Contribution Plan Dollar limit on additions on Sections 415(c)(1)(A) |
$45,000 |
$44,000 |
|
Defined Benefit Plan limit on benefits (Section 415(b)(1)(A)) |
$180,000 |
$175,000 |
|
Maximum compensation used to determine contributions |
$225,000 |
$220,000 |
|
401(k), SARSEP, 403(b) Plan Deferrals (Section 402(g)), & 457 Plan deferrals (Section 457(b)(2)) |
$15,500 |
$15,000 |
|
401(k), 403(b), 457 & SARSEP additional "catch-up" contributions for employees age 50 and older |
$5,000 |
$5,000 |
|
SIMPLE deferrals (Section 408(p)(2)(A)) |
$10,500 |
$10,000 |
SIMPLE additional "catch-up" contributions
for employees age 50 and older |
$2,500 |
$2,500 |
|
Compensation defining highly compensated employee (Section 414(q)(1)(B)) |
$100,000 |
$100,000 |
| Compensation defining key employee (officer) |
$145,000 |
$140,000 |
|
Compensation triggering Simplified Employee Pension (SEP) contribution requirement (Section 408(k)(2)(c)) |
$500 |
$450 |
| Driving Deductions |
2007 |
2006 |
| Business mileage, cents per mile |
48.5 |
44.5 |
| Charitable mileage, cents per mile |
14 |
14 |
| Medical and moving mileage, cents per mile |
20 |
18 |
| Business Equipment |
2007 |
2006 |
| Maximum Section 179 expense deduction |
$112,000 |
$108,000 |
| Phaseout for Section 179 |
$450,000 |
$430,000 |
| Qualified Transportation Fringe Benefit Exclusion |
2007 |
2006 |
| Commuter highway vehicle and transit pass, per month |
110 |
105 |
| Qualified parking, per month |
215 |
205 |
| Domestic Employees |
2007 |
2006 |
| Annual threshold when a domestic employer is liable to withhold and pay FICA for babysitters, housekeepers, etc. |
$1,500 |
$1,500 |
| Standard Deduction |
2007 |
2006 |
|
Married filing jointly |
$10,700 |
$10,300 |
|
Single (and married filing separately) |
$ 5,350 |
$5,150 |
|
Heads of Household
| $ 7,850 |
$7,550 |
| Itemized Deduction Phase-Out |
2007 |
2006 |
| Amount for all filing status categories except married filing separately |
$156,400 |
$150,500 |
| Married filing separately |
$78,200 |
$75,250 |
|
Personal Exemption |
2007 |
2006 |
|
Amount |
$3,400 |
$3,300 |
|
Kiddie Tax |
2007 |
2006 |
|
Net unearned income for an under-age-18 child that is not subject to the "kiddie tax" |
$1,700 |
$1,700 |
| Annual Exclusion for Gifts |
2007 |
2006 |
| Amount you can give to each recipient |
$12,000 |
$12,000 |
| IRS Form 8300 Requirement |
2007 |
2006 |
| Cash amount received by a business in one transaction that triggers a requirement to file Form 8300 with the IRS and give a written statement to each person listed on it. |
$10,000 |
$10,000 |
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Our firm provides the information in this e-newsletter for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. Tax articles in this e-newsletter are not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided "as is," with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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