Caveat emptor!
You are legally responsible for your tax returns even if someone else prepared the returns for you.
Who qualifies as an income tax preparer?
According to IRS, a tax preparer is any person who receives compensation for preparation of another individual's tax return.
However, there are NO educational & professional requirements from IRS for income tax preparers.
Types of income tax preparer
1) Local tax services
2) National tax services, such as H.R. Block or Jackson Hewitt
3) Enrolled agents (EA)
4) Certified public accountants (CPA)
5) Tax attorneys
Please note that only CPA and tax attorney have educational and professional requirements.
Choosing an income tax preparer
You should decide what level of services you need and how much you can afford to pay.
Do you want to save time, money, or both? Are you looking for someone to only prepare your tax return? Or, do you need someone to be your tax advisor year-around?
1) Does the preparer has training & experience in your tax situation? Does the preparer keep abreast of tax laws & changes in your area?
2) Can the preparer be reached during the year? Can the preparer represent you in an audit? Please note that only EA, CPA, or tax attorneys are authorized to represent you to IRS.
3) How is the fee determined? Ask for an estimated. Ensure that you have a clear understanding of the cost and what it includes. The fees could be based on the complexity of the return, but never on the size of the tax saving or refund.
Please go to this IRS web page for more information.
Free tax return preparation
The IRS has programs offer free tax help if you qualify.
1) Volunteer Income Tax Assistance (VITA) Program offers free tax help to low- to moderate-income (generally, $39,000 or less) people.
2) Tax Counseling for the Elderly (TCE) Program offers free tax help to people age 60 and older.
However, most volunteers often are just fill-in the lines on the tax forms; they may not able to offer any tax planning or advice.
7 May 2007 - Created
9 Aug 2008 - Updated
Saturday, August 9, 2008
Wednesday, June 4, 2008
Saturday, May 24, 2008
The rule of investing success
From: Internet
THE RULE
You must have stocks and bonds in your investment portfolio
Asset allocation
Or simply
% stocks = 120 - age
Index mutual funds
You really only need 3 mutual funds to cover entire stock and bond market.
1) Total US market stocks index fund
2) Total foreign stocks index fund (10% to 15% of your stock portfolio, most large US companies already are global company.)
3) Total bonds index fund
THE RULE
You must have stocks and bonds in your investment portfolio
Asset allocation
| TYPE | Age | Stocks | Bonds |
| GROWTH | 40s or younger | 70% | 30% |
| BALANCED | 50s to 60s | 50% | 50% |
| CONSERVATIVE | 70s or older | 20% | 80% |
Or simply
% stocks = 120 - age
Index mutual funds
You really only need 3 mutual funds to cover entire stock and bond market.
1) Total US market stocks index fund
2) Total foreign stocks index fund (10% to 15% of your stock portfolio, most large US companies already are global company.)
3) Total bonds index fund
Friday, May 23, 2008
Asset allocation with Vanguard index funds
From Morningstar.com
Assuming you want to build a portfolio of 70% stocks and 30% fixed income
Please note that you could easily build a similar portfolio with all Fidelity funds.
Assuming you want to build a portfolio of 70% stocks and 30% fixed income
% | Index funds | ETF |
50 | ||
20 | - | |
25 |
Please note that you could easily build a similar portfolio with all Fidelity funds.
Free tools for asset allocation
From: Internet
Moringstar: Instant X-ray
Tip: If you have ETF in your portfolio, enter its corresponding mutual fund instead.
SEC: Asset Allocation 101
Iowa Public Employees Retirement System: Online Calculator
Moringstar: Instant X-ray
Tip: If you have ETF in your portfolio, enter its corresponding mutual fund instead.
SEC: Asset Allocation 101
Iowa Public Employees Retirement System: Online Calculator
Wednesday, May 21, 2008
Five Basics for Building a Solid Financial Future
From nytimes.com
0. Live within Your Means. And start an emergency fund.
1. Simplify Your Investments. Allocate your investments among index funds. Reallocate occasionally.
2. Occasionally Pay For Help. Discipline in investing is worth paying for. Also, get help on taxes and financial planning.
3. However, there is a lot of good advices are on Internet.
4. Automate everything.
5. Communicate. Discuss your finances with your family.
0. Live within Your Means. And start an emergency fund.
1. Simplify Your Investments. Allocate your investments among index funds. Reallocate occasionally.
2. Occasionally Pay For Help. Discipline in investing is worth paying for. Also, get help on taxes and financial planning.
3. However, there is a lot of good advices are on Internet.
4. Automate everything.
5. Communicate. Discuss your finances with your family.
Sunday, May 18, 2008
5 BIG goals in your life
Updated: 5/18/08
TNS reported that millionaire houldholds in US raised to record-breaking level of 9.9 million.
Posted: 6/9/07
Source: Amanda Gengler, Josh Hyatt, and Penelope Wang of money.com
Become a millionaire
About 9.3 million U.S. households (out of 114 million households) have a net worth of at least $1 million, excluding primary residence.
However, it's not as hard to become a millionaire as you might think.
1. Start early and make saving automatic
2. Make full use of any tax benefits for your savings
3. Invest in stock markets - the long-term rate of return for stocks is ~9%.
However, 46% of millionaire households also own real estate as investment.
4. Boost your earning power
Most (32%) wealth of millionaires comes from job earnings.
5. Don't stop saving, keep going even after you hit the $1,000,000 mark.
Own your dream home (i.e. 2nd home)
1. Save the estimated monthly payment
2. Tap your primary home
3. Take advantage of the buyer's market
4. Go in with family and friends
Send your kid to Harvard (or any really expensive school)
Try to save a third of the bill; the rest should come from financial aids, student loans, and your future incomes.
1. Start to save now
72% of parents think their kids could get merit aid - but only 28% of kids actually do.
2. Save in a 529
3. Plan for financial aid
4. It really doesn't have to be Harvard!
Success in life has more to do with overall ambition than where you go to school.
Retire early
1. Save, save, save
2. Live less than large - saving has to be your first priority.
3. Be aggressive with your portfolio
4. Bank your extra income
5. Design a post-retirement career
Launch your own business
Starting a company is hard. But if you succeed, you're on your way to financial independence.
1. Write a business plan
2. Go sell something
3. Look for smarter advisers
4. Warn your family
It will take you three years make a profit.
5. Expect the unexpected
TNS reported that millionaire houldholds in US raised to record-breaking level of 9.9 million.
Posted: 6/9/07
Source: Amanda Gengler, Josh Hyatt, and Penelope Wang of money.com
Become a millionaire
About 9.3 million U.S. households (out of 114 million households) have a net worth of at least $1 million, excluding primary residence.
However, it's not as hard to become a millionaire as you might think.
1. Start early and make saving automatic
2. Make full use of any tax benefits for your savings
3. Invest in stock markets - the long-term rate of return for stocks is ~9%.
However, 46% of millionaire households also own real estate as investment.
4. Boost your earning power
Most (32%) wealth of millionaires comes from job earnings.
5. Don't stop saving, keep going even after you hit the $1,000,000 mark.
Own your dream home (i.e. 2nd home)
1. Save the estimated monthly payment
2. Tap your primary home
3. Take advantage of the buyer's market
4. Go in with family and friends
Send your kid to Harvard (or any really expensive school)
Try to save a third of the bill; the rest should come from financial aids, student loans, and your future incomes.
1. Start to save now
72% of parents think their kids could get merit aid - but only 28% of kids actually do.
2. Save in a 529
3. Plan for financial aid
4. It really doesn't have to be Harvard!
Success in life has more to do with overall ambition than where you go to school.
Retire early
1. Save, save, save
2. Live less than large - saving has to be your first priority.
3. Be aggressive with your portfolio
4. Bank your extra income
5. Design a post-retirement career
Launch your own business
Starting a company is hard. But if you succeed, you're on your way to financial independence.
1. Write a business plan
2. Go sell something
3. Look for smarter advisers
4. Warn your family
It will take you three years make a profit.
5. Expect the unexpected
Fidelity's asset allocation strategies
Source: Fidelity
Why we need to allocate our portfolio:
The following table shown the updated annual returns from 1926 to 2007
Why we need to allocate our portfolio:
The following table shown the updated annual returns from 1926 to 2007
| FI vs Stocks | 100:0 | 80:20 | 50:50 | 30:70 | 15:85 |
| Average return | 3.7 | 6.2 | 8.2 | 9.2 | 9.9 |
| 1 yr best | 15 | 31 | 77 | 110 | 136 |
| 1 yr worst | -0 | -18 | -41 | -53 | -61 |
| 5 yr best | 11 | 17 | 22 | 27 | 32 |
| 5 yr worst | +0 | -0 | -6 | -10 | -14 |
Fidelity mySmart Cash account in Quicken program
Source: Fidelity Investments
By default, Quicken treats mySmart Cash account as an investment account.
Q: Can I designate a mySmart Cash Account as a checking account in Quicken?
A: Quicken recognizes a mySmart Cash Account as a checking account when you follow these steps:
From the Main Menu in Quicken, choose Tools > Accounts List
Select the investment account to which you'd like to add a linked checking account, then click the Edit button.
On the General Information tab on the Account Details window, choose "yes" to "Show cash in a checking account." Quicken will prompt you to back up your data file.
Once the backup is complete, the linked checking account is created in Quicken with the same name as your investment account, plus the suffix "Cash." Click the OK button to save your changes.
Quicken converts all transactions in the investment account to their transfer equivalents. For example, "Buy" transactions are converted to "Buy X" transactions, and "Sell" transactions are converted to "Sell X" transactions.
By default, Quicken treats mySmart Cash account as an investment account.
Q: Can I designate a mySmart Cash Account as a checking account in Quicken?
A: Quicken recognizes a mySmart Cash Account as a checking account when you follow these steps:
From the Main Menu in Quicken, choose Tools > Accounts List
Select the investment account to which you'd like to add a linked checking account, then click the Edit button.
On the General Information tab on the Account Details window, choose "yes" to "Show cash in a checking account." Quicken will prompt you to back up your data file.
Once the backup is complete, the linked checking account is created in Quicken with the same name as your investment account, plus the suffix "Cash." Click the OK button to save your changes.
Quicken converts all transactions in the investment account to their transfer equivalents. For example, "Buy" transactions are converted to "Buy X" transactions, and "Sell" transactions are converted to "Sell X" transactions.
Friday, May 2, 2008
Online tools for your taxes
Online tools from IRS
Where is my Stimulus Payment can show the status of your tax rebate check or deposit.
IRS recommend checking the Payment Schedule prior to using this online tool since your payment information will not be available on this tool until the time that your payment is scheduled.
Where is my refund can show the status of your tax refund check or deposit.
Where is my Stimulus Payment can show the status of your tax rebate check or deposit.
IRS recommend checking the Payment Schedule prior to using this online tool since your payment information will not be available on this tool until the time that your payment is scheduled.
Where is my refund can show the status of your tax refund check or deposit.
New interest rate for US savings bonds
Treasury Direct released new interest rates for the saving bonds:
Series I savings bonds will earn 4.84% for next 6 months; however, the fixed rate is 0.00%!
I Bond earnings rate is a combination of a fixed rate, which applies for the life of the bond (30 years), and the semiannual inflation rate.
For the I bonds purchased from May 1 of 2008 to October 31 of 2008, their earning rate will only match the inflation rate.
Also, series EE savings bonds purchased from May 1 of 2008 to October 31 of 2008 will earn 1.20% for the life of the bond (30 years).
However, if the EE bond does not double in value as the result of applying the fixed rate for 20 years, the U.S. Treasury will make a one-time adjustment at original maturity (20th year) to make up the difference.
Is there any reasons to buy series EE instead of series I saving bonds?
Series I savings bonds will earn 4.84% for next 6 months; however, the fixed rate is 0.00%!
I Bond earnings rate is a combination of a fixed rate, which applies for the life of the bond (30 years), and the semiannual inflation rate.
For the I bonds purchased from May 1 of 2008 to October 31 of 2008, their earning rate will only match the inflation rate.
Also, series EE savings bonds purchased from May 1 of 2008 to October 31 of 2008 will earn 1.20% for the life of the bond (30 years).
However, if the EE bond does not double in value as the result of applying the fixed rate for 20 years, the U.S. Treasury will make a one-time adjustment at original maturity (20th year) to make up the difference.
Is there any reasons to buy series EE instead of series I saving bonds?
Rebate check from IRS will be earlier than planned
Updated 2:
I got mine deposited on 5/1/08
Updated 1:
The IRS started making the direct deposits on Monday with the goal of completing 800,000 payments each day over the first three days of this week. No deposits will be made Thursday while the IRS prepares a big batch of 5 million direct deposits scheduled on Friday.
First week:
4/28/08 - 800,000 direct deposits
4/29/08 - 800,000 direct deposits
4/30/08 - 800,000 direct deposits
5/1/08 - 0
5/2/08 - 5,000,000 direct deposits
From the news:
The rebate checks will be deposit or mail to us 1 week earlier.
Direct Deposit Schedule
Last two digits of your Social Security number:
00 – 20 --> April 28
21 – 75 --> May 2
76 – 99 --> May 9
Check by Mail Schedule
Last two digits of your Social Security number:
00 – 09 --> May 9
10 – 18 --> May 16
19 – 25 --> May 23
26 – 38 --> May 30
39 – 51 --> June 6
52 – 63 --> June 13
64 – 75 --> June 20
76 – 87 --> June 27
88 – 99 --> July 4
Of course, you have to file your 2007 returns early enough.
I got mine deposited on 5/1/08
Updated 1:
The IRS started making the direct deposits on Monday with the goal of completing 800,000 payments each day over the first three days of this week. No deposits will be made Thursday while the IRS prepares a big batch of 5 million direct deposits scheduled on Friday.
First week:
4/28/08 - 800,000 direct deposits
4/29/08 - 800,000 direct deposits
4/30/08 - 800,000 direct deposits
5/1/08 - 0
5/2/08 - 5,000,000 direct deposits
From the news:
The rebate checks will be deposit or mail to us 1 week earlier.
Direct Deposit Schedule
Last two digits of your Social Security number:
00 – 20 --> April 28
21 – 75 --> May 2
76 – 99 --> May 9
Check by Mail Schedule
Last two digits of your Social Security number:
00 – 09 --> May 9
10 – 18 --> May 16
19 – 25 --> May 23
26 – 38 --> May 30
39 – 51 --> June 6
52 – 63 --> June 13
64 – 75 --> June 20
76 – 87 --> June 27
88 – 99 --> July 4
Of course, you have to file your 2007 returns early enough.
Saturday, April 12, 2008
Brokerage CD
Updated
Now I have 3 CDs from Countrywide Bank
1) 5.65% for 12 months.
2) 6.125% for 240 months
3) 6% for 240 months
I brought last 2 through Fidelity.
Despite recent drop of interest rate, I was able to put money into 2 CDs from Countrywide Bank with pretty high interest rate.
Now I have 3 CDs from Countrywide Bank
1) 5.65% for 12 months.
2) 6.125% for 240 months
3) 6% for 240 months
I brought last 2 through Fidelity.
Despite recent drop of interest rate, I was able to put money into 2 CDs from Countrywide Bank with pretty high interest rate.
1) 5.65% for 12 months.
2) 6.125% for 240 months.
The second is a brokerage CD which is certificate of deposit sold for the bank (Countrywide Bank) by a broker (Fidelity).
However, this CD is callable after 12 months.
If the interest rate drops further in next year, Countrywide Bank probably will call this CD.
Sunday, January 6, 2008
2007 federal tax brackets
Federal tax rate for taxable income of Single & Married File Jointly (MFJ)
(Not shown are Head of Household and Married File Separately )
(Not shown are Head of Household and Married File Separately )
| Marginal Rate | Single | MFJ |
| 10% | $0 - $7,825 | $0 - $15,650 |
| 15% | $7,826 - $31,850 | $15,651 - $63,700 |
| 25% | $31,851 - $77,100 | $63,701 - $128,500 |
| 28% | $77,101 - $160,850 | $128,501 - $195,850 |
| 33% | $160,851 - $349,700 | $195,851 - $349,700 |
| 35% | Over $349,700 | Over $349,700 |
2007 federal exemption & deductions
Personal exemption
$3,400
$3,400
Personal exemption phase-outsStandard Deductions
$234,600 - $357,100 Joint return
$195,500 - $318,000 Head of household
$156,400 - $278,900 Single
$117,300 - $178,550 Married couple filing separately
$10,700 Married filling jointly or qualifying widow(er)
$7,850 Heads of households
$5,350 Singles
$5,350 Married filling separately
2007 earned income tax credit
Earned Income Credit (EITC)The most credit you can get is:
$2,853 if you have one qualifying child,
$4,716 if you have more than one qualifying child, or
$428 if you do not have a qualifying child.
The maximum amount of income you can earn and still get credit of $1 to $4 is:
$37,783 ($39,783 if married filing jointly) if you have more than one qualifying child,
$33,241 ($35,241 if married filing jointly) if you have one qualifying child, or
$12,590 ($14,590 if married filing jointly) if you do not have a qualifying child.
The maximum amount of investment income you can have and still get the credit is $2,900.
Tax changes in retirement plans for tax year 2007
Catch-Up Contributions if Employer Bankrupt
For 2007, if you participated in a 401(k) plan and the employer who maintained the plan filed for bankruptcy, you may be able to contribute an additional $3,000 to your IRA. For this to apply the following conditions must be met.
*You must have been a participant in a 401(k) plan under which the employer matched at least 50% of your contributions to the plan with stock of the company.
*You must have been a participant in the 401(k) plan 6 months before the employer filed for bankruptcy.
*The employer (or a controlling corporation) must have been a debtor in a bankruptcy case in an earlier year.
*The employer (or any other person) must have been subject to indictment or conviction based on business transactions related to the bankruptcy.
If you choose to make these additional contributions, you cannot use the higher contribution and deduction limits for individuals who are age 50 or older.
Income Exclusion for Retired Public Safety Officer
For distributions in tax years beginning after 2006, you can elect to exclude from income an eligible retirement plan distribution if you are a retired public safety officer. The distribution must be from a governmental plan and must be transferred directly to pay premiums for accident or health insurance or qualified long-term care insurance for you, your spouse, or your dependents.
The maximum annual exclusion is $3,000.
You cannot deduct these premiums as medical expenses or, if you are self-employed, health insurance costs.
Modified AGI Limit for Traditional IRA Contributions Increased
For 2007, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified adjusted gross income (AGI) is:
*More than $83,000 but less than $103,000 for MFJ or a qualifying widow(er),
*More than $52,000 but less than $62,000 for a single or HH, or
*Less than $10,000 for MFS.
If you either live with your spouse at any time during 2007 or file a joint return for 2007; and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your AGI is more than $156,000 but less than $166,000.
Rollovers by Nonspouse Beneficiary
After 2006, you may be able to roll over tax free all or a portion of a distribution you receive from an eligible retirement plan of a deceased employee. You must be the designated beneficiary of the employee, but you cannot be the surviving spouse. The distribution must be a direct trustee-to-trustee transfer to your IRA that was set up to receive the distribution. The transfer will be treated as an eligible rollover distribution and the receiving plan will be treated as an inherited IRA.
Modified AGI Limit for Retirement Savings Contribution Credit Increased
For 2007, you may be able to claim the retirement savings contribution credit if your modified adjusted gross income is not more than:
$52,000 if your filing status is MFJ,
$39,000 if your filing status is HH, or
$26,000 if your filing status is single, MFJ, or qualifying widow(er).
Rollover of Nontaxable Amounts
For tax years beginning after 2006, the nontaxable part of an eligible rollover distribution (such as after-tax contributions) from a qualified retirement plan can be rolled over to another qualified retirement plan or to an annuity contract described in section 403(b). Previously, this part of the distribution could be rolled over only to another qualified retirement plan that was a defined contribution plan.
The rollover must be a direct trustee-to-trustee transfer.
The plan to which the rollover is made must separately account for these contributions and the earnings on them.
Modified AGI Limit for Roth IRA Contribution Increased
For 2007, your Roth IRA contribution limit is reduced (phased out) in the following situations.
Your filing status is married filing jointly or qualifying widow(er) and your modified AGI is at least $156,000. You cannot make a Roth IRA contribution if your modified AGI is $166,000 or more.
Your filing status is married filing separately, you lived with your spouse at any time during the year, and your modified AGI is more than -0-. You cannot make a Roth IRA contribution is your modified AGI is $10,000 or more.
Your filing situation is different than either of those described above and your modified AGI is at least $99,000. You cannot make a Roth IRA contribution is your modified AGI is $114,000 or more.
Qualified Plans
The following changes apply to qualified plans.
Limits on contributions and benefits. For 2007, the maximum annual benefit for a participant under a defined benefit plan has increased to the smaller of: $180,000, or 100% of the participant's average compensation for his or her highest 3 consecutive calendar years.
For 2007, a defined contribution plan's maximum annual contributions and other additions (excluding earnings) to the account of a participant has increased to the smaller of:
$45,000, or 100% of the compensation actually paid to the participant.
Compensation limit. For 2007, the maximum compensation used for figuring contributions and benefits has increased to $225,000.
Elective deferrals (401(k) plans). For 2007, the limit on elective deferrals (excluding catch-up contributions) for participants in 401(k) plans and SARSEPs (excluding SIMPLE plans) is $15,500.
Simplified Employee Pensions (SEPs)
The following changes apply to SEPs.
Elective deferrals (SARSEPs) limit. The limits on elective deferrals for participants in SARSEPs are discussed earlier under Elective deferrals (401(k) plans).
Deduction limit increased. The maximum deduction for contributions to a SEP remains unchanged at 25% of the compensation paid or accrued during the year to your eligible employees participating in the plan. However, for 2007, the maximum combined deduction for a participant's elective deferrals and other SEP contributions has increased to $45,000.
Contribution limit increased. For 2007, the annual limit on the amount of employer contributions to a SEP has increased to the smaller of: $45,000, or 25% of an eligible employee's compensation.
Compensation limit. For 2007, the maximum amount of an employee's compensation you can consider when figuring SEP contributions (including elective deferrals) and the deduction for contributions has increased to $225,000.
SIMPLE Plans
The following change applies to SIMPLE plans.
Salary reduction contributions. For 2007, the limit on salary reduction contributions (excluding catch-up contributions) to a SIMPLE plan is $10,500.
403(b) Plans
The following changes apply to 403(b) plans.
Increase in the limit on elective deferrals. For 2007, the limit on elective deferrals (excluding catch-up contributions) has increased to $15,500.
Limit on annual additions. For 2007, the limit on annual additions has increased to $45,000.
For 2007, if you participated in a 401(k) plan and the employer who maintained the plan filed for bankruptcy, you may be able to contribute an additional $3,000 to your IRA. For this to apply the following conditions must be met.
*You must have been a participant in a 401(k) plan under which the employer matched at least 50% of your contributions to the plan with stock of the company.
*You must have been a participant in the 401(k) plan 6 months before the employer filed for bankruptcy.
*The employer (or a controlling corporation) must have been a debtor in a bankruptcy case in an earlier year.
*The employer (or any other person) must have been subject to indictment or conviction based on business transactions related to the bankruptcy.
If you choose to make these additional contributions, you cannot use the higher contribution and deduction limits for individuals who are age 50 or older.
Income Exclusion for Retired Public Safety Officer
For distributions in tax years beginning after 2006, you can elect to exclude from income an eligible retirement plan distribution if you are a retired public safety officer. The distribution must be from a governmental plan and must be transferred directly to pay premiums for accident or health insurance or qualified long-term care insurance for you, your spouse, or your dependents.
The maximum annual exclusion is $3,000.
You cannot deduct these premiums as medical expenses or, if you are self-employed, health insurance costs.
Modified AGI Limit for Traditional IRA Contributions Increased
For 2007, if you are covered by a retirement plan at work, your deduction for contributions to a traditional IRA is reduced (phased out) if your modified adjusted gross income (AGI) is:
*More than $83,000 but less than $103,000 for MFJ or a qualifying widow(er),
*More than $52,000 but less than $62,000 for a single or HH, or
*Less than $10,000 for MFS.
If you either live with your spouse at any time during 2007 or file a joint return for 2007; and your spouse is covered by a retirement plan at work, but you are not, your deduction is phased out if your AGI is more than $156,000 but less than $166,000.
Rollovers by Nonspouse Beneficiary
After 2006, you may be able to roll over tax free all or a portion of a distribution you receive from an eligible retirement plan of a deceased employee. You must be the designated beneficiary of the employee, but you cannot be the surviving spouse. The distribution must be a direct trustee-to-trustee transfer to your IRA that was set up to receive the distribution. The transfer will be treated as an eligible rollover distribution and the receiving plan will be treated as an inherited IRA.
Modified AGI Limit for Retirement Savings Contribution Credit Increased
For 2007, you may be able to claim the retirement savings contribution credit if your modified adjusted gross income is not more than:
$52,000 if your filing status is MFJ,
$39,000 if your filing status is HH, or
$26,000 if your filing status is single, MFJ, or qualifying widow(er).
Rollover of Nontaxable Amounts
For tax years beginning after 2006, the nontaxable part of an eligible rollover distribution (such as after-tax contributions) from a qualified retirement plan can be rolled over to another qualified retirement plan or to an annuity contract described in section 403(b). Previously, this part of the distribution could be rolled over only to another qualified retirement plan that was a defined contribution plan.
The rollover must be a direct trustee-to-trustee transfer.
The plan to which the rollover is made must separately account for these contributions and the earnings on them.
Modified AGI Limit for Roth IRA Contribution Increased
For 2007, your Roth IRA contribution limit is reduced (phased out) in the following situations.
Your filing status is married filing jointly or qualifying widow(er) and your modified AGI is at least $156,000. You cannot make a Roth IRA contribution if your modified AGI is $166,000 or more.
Your filing status is married filing separately, you lived with your spouse at any time during the year, and your modified AGI is more than -0-. You cannot make a Roth IRA contribution is your modified AGI is $10,000 or more.
Your filing situation is different than either of those described above and your modified AGI is at least $99,000. You cannot make a Roth IRA contribution is your modified AGI is $114,000 or more.
Qualified Plans
The following changes apply to qualified plans.
Limits on contributions and benefits. For 2007, the maximum annual benefit for a participant under a defined benefit plan has increased to the smaller of: $180,000, or 100% of the participant's average compensation for his or her highest 3 consecutive calendar years.
For 2007, a defined contribution plan's maximum annual contributions and other additions (excluding earnings) to the account of a participant has increased to the smaller of:
$45,000, or 100% of the compensation actually paid to the participant.
Compensation limit. For 2007, the maximum compensation used for figuring contributions and benefits has increased to $225,000.
Elective deferrals (401(k) plans). For 2007, the limit on elective deferrals (excluding catch-up contributions) for participants in 401(k) plans and SARSEPs (excluding SIMPLE plans) is $15,500.
Simplified Employee Pensions (SEPs)
The following changes apply to SEPs.
Elective deferrals (SARSEPs) limit. The limits on elective deferrals for participants in SARSEPs are discussed earlier under Elective deferrals (401(k) plans).
Deduction limit increased. The maximum deduction for contributions to a SEP remains unchanged at 25% of the compensation paid or accrued during the year to your eligible employees participating in the plan. However, for 2007, the maximum combined deduction for a participant's elective deferrals and other SEP contributions has increased to $45,000.
Contribution limit increased. For 2007, the annual limit on the amount of employer contributions to a SEP has increased to the smaller of: $45,000, or 25% of an eligible employee's compensation.
Compensation limit. For 2007, the maximum amount of an employee's compensation you can consider when figuring SEP contributions (including elective deferrals) and the deduction for contributions has increased to $225,000.
SIMPLE Plans
The following change applies to SIMPLE plans.
Salary reduction contributions. For 2007, the limit on salary reduction contributions (excluding catch-up contributions) to a SIMPLE plan is $10,500.
403(b) Plans
The following changes apply to 403(b) plans.
Increase in the limit on elective deferrals. For 2007, the limit on elective deferrals (excluding catch-up contributions) has increased to $15,500.
Limit on annual additions. For 2007, the limit on annual additions has increased to $45,000.
Tax changes for individuals in tax year 2007
Alternative Minimum Tax (AMT)
The following changes to the AMT went into effect for 2007.
AMT exemption amount decreased. The AMT exemption amount has decreased to
$33,750 if single
$45,000 if married filing jointly or qualifying widow(er)
$22,500 if married filing separately.
Exemption amount for a child. The minimum exemption amount for a child under age 18 has increased to $6,300.
Hurricane Katrina additional exemption expired. The additional exemption for taxpayers who provide housing for a person displaced by Hurricane Katrina has expired. Therefore, the additional exemption amount (formerly line 6 of Form 8914) is no longer allowable for the AMT.
Certain credits no longer allowed against the AMT. The following credits:
*The credit for child and dependent care expenses,
*credit for the elderly or the disabled,
*education credits,
*residential energy credits,
*mortgage interest credit, and
*the District of Columbia first-time homebuyer credit
are no longer allowed against the AMT, and a new tax liability limit applies. This limit is your regular tax minus any tentative minimum tax (figured without any AMT foreign tax credit).
Standard Mileage Rate
Business-related mileage. For 2007, the standard mileage rate for the cost of operating your car for business use is 48.5 cents per mile.
Medical- and move-related mileage. For 2007, the standard mileage rate for the cost of operating your car for medical reasons or as part of a deductible move is 20 cents per mile.
Charitable-related mileage. For 2007, the standard mileage rate for the cost of operating your car for charitable purposes remains 14 cents per mile.
Earned Income Credit (EITC)
The following paragraphs explain the changes to the credit for 2007.
Amount of credit increased. The maximum amount of the credit has increased. The most you can get is:
$2,853 if you have one qualifying child,
$4,716 if you have more than one qualifying child, or
$428 if you do not have a qualifying child.
Earned income amount increased. The maximum amount of income you can earn and still get the credit has increased for 2007. You may be able to take the credit of $1 to $4 if:
You have two qualifying children and you earn less than $37,783 ($39,783 if MFJ),
You have one and you earn less than $33,241 ($35,241 if MFJ), or
You do not have a qualifying child and you earn less than $12,590 ($14,590 if MFJ).
The maximum amount of adjusted gross income (AGI) you can have and still get the credit also has increased. You may be able to take the credit if your AGI is less than the amount in the above list that applies to you.
Investment income amount increased. The maximum amount of investment income you can have and still get the credit has increased to $2,900 for 2007.
Advance payment of the credit. If you get advance payments of the credit from your employer with your pay, the total advance payments you get during 2007 can be as much as $1,712.
Nontaxable combat pay election extended. You can elect to have your nontaxable combat pay included in earned income when you figure your earned income credit for 2007.
Standard Deduction Amount Increased
The standard deduction for people who do not itemize deductions on Schedule A (Form 1040) is, in most cases, higher for 2007 than it was for 2006.
Exemption Amount Increased
The amount you can deduct for each exemption has increased to $3,400 in 2007.
You lose part of the benefit of your exemptions if your adjusted gross income is above a certain amount. For 2007, the phaseout begins at:
$117,300 for married persons filing separately,
$156,400 for single individuals,
$195,500 for heads of household, and
$234,600 for MFJ or qualifying widow(er)s.
Charitable Contributions
New recordkeeping requirements for cash contributions. You cannot deduct a cash contribution, regardless of the amount, unless you keep as a record of the contribution a bank record (such as a canceled check, a bank copy of a canceled check, or a bank statement containing the name of the charity, the date, and the amount) or a written communication from the charity. The written communication must include the name of the charity, date of the contribution, and amount of the contribution.
Contributions to donor advised funds. You cannot deduct a contribution to a donor advised fund after February 13, 2007, if the sponsoring organization is a war veterans' organization, a fraternal society, or a nonprofit cemetery company. There are also other circumstances in which you cannot deduct your contribution to a donor advised fund.
Filing fee for easements on buildings in historic districts. A new $500 filing fee must be paid for each qualified conservation contribution after February 12, 2007, that is an easement on a building in a registered historic district, if the claimed deduction is more than $10,000.
Social Security and Medicare Taxes
The maximum amount of wages subject to the social security tax for 2007 is $97,500. There is no limit on the amount of wages subject to the Medicare tax.
Income Limits Increased for Student Loan Interest Deduction
For 2007, the amount of the student loan interest deduction is phased out if your MAGI is between $55,000 and $70,000 (between $110,000 and $140,000 if MFJ).
Income Limits Increased for Hope and Lifetime Learning Credits
For 2007, the amount of your Hope or lifetime learning credit is phased out (gradually reduced) if your MAGI is between $47,000 and $57,000 ($94,000 and $114,000 if you file MFJ).
Earned Income Amount for Additional Child Tax Credit
For 2007, the minimum earned income amount used to figure the additional child tax credit has increased to $11,750.
Mortgage Insurance Premium Deduction
Premiums that you pay or accrue for “qualified mortgage insurance” during 2007 in connection with home acquisition debt on your qualified home are deductible as an itemized deduction. The amount you can deduct is reduced by 10% (.10) for every $1,000 ($500 if your filing status is married filing separately) by which your adjusted gross income exceeds $100,000($50,000 if your filing status is married filing separately).
Mortgage insurance premiums you paid or accrued on any mortgage insurance contract issued before January 1, 2007, or accrued after December 31, 2007, or that are properly allocable to any period after December 31, 2007, are not deductible as an itemized deduction.
Qualified mortgage insurance. Qualified mortgage insurance is mortgage insurance provided by the Veterans Administration, the Federal Housing Administration, or the Rural Housing Administration, and private mortgage insurance.
Limit on Itemized Deductions Increased
If your adjusted gross income is above a certain amount, you may lose part of your itemized deductions. In 2007, this amount is increased to $156,400 ($78,200 if MFS).
Health Savings Accounts (HSAs)
High deductible health plan (HDHP). For HSA purposes, the minimum annual deductible of an HDHP increases to $1,100 ($2,200 for family coverage) and the maximum annual deductible and other out-of-pocket expenses limit increases to $5,500 ($11,000 for family coverage).
Deductible limitation on contributions. The annual deductible limitation for contributions to your HSA based on the amount of your health insurance deductible is repealed. For 2007, the maximum HSA deduction increases to $2,850 ($5,650 for family coverage) regardless of the amount of your health insurance deductible. The maximum additional deduction for individuals age 55 or older increases to $800.
Transfers from an individual retirement account (IRA) to an HSA. You can elect to make a one-time direct trustee-to-trustee transfer from your IRA (other than a Simple IRA or a SEP IRA) to your HSA. The maximum amount you can transfer is the maximum HSA contribution limitation for the year. The amount transferred is not included in your income, is not deductible, and reduces your HSA contribution limitation for the year.
Adoption Benefits Increased
For 2007, the maximum adoption credit has increased to $11,390. Also, the maximum exclusion from income for benefits under your employer's adoption assistance program has increased to $11,390.
These amounts are phased out if your MAGI is between $170,820 and $210,820.
Income Limits Increased for Reduction of Education Savings Bond Exclusion
For 2007, the amount of your interest exclusion is phased out (gradually reduced) if your filing status is MFJ or qualifying widow(er) and your MAGI is between $98,400 and $128,400.
For all other filing statuses, your interest exclusion is phased out if your MAGI is between $65,600 and $80,600.
Credit for Prior Year Minimum Tax
If you have any unused minimum tax credit carry forward from 2003 or earlier years, your minimum tax credit allowable for 2007 is not less than the “AMT refundable credit amount.” In addition, a portion of the credit may be refundable in 2007.
Increase in Deductible Limit for Long-Term Care Premiums
For 2007, the maximum amount of qualified long-term care premiums you can include as medical expenses has increased. You can include qualified long-term care premiums, up to the amounts shown below, as medical expenses on Schedule A (Form 1040).
*Age 40 or under - $290.
*Age 41 to 50 - $550.
*Age 51 to 60 - $1,110.
*Age 61 to 70 - $2,950.
*Age 71 or over - $3,680.
Note. The limit is for each person.
Increase in Limit on Long-Term Care and Accelerated Death Benefits Exclusion
The limit on the exclusion for payments made on a per diem or other periodic basis under a long-term care insurance contract increases for 2007 to $260 per day.
The limit applies to the total of these payments and any accelerated death benefits made
on a per diem or other periodic basis under a life insurance contract because the insured is chronically ill.
Archer MSA Limits Increased
For Archer MSA purposes for 2007, the minimum annual deductible of a high deductible health plan increases to $1,900 ($3,750 for family coverage).
The maximum annual deductible of a high deductible health plan increases to $2,850 ($5,650 for family coverage).
The maximum out-of-pocket expenses limit increases to $3,750 ($6,900 for family coverage).
Capital Asset Treatment for Self-Created Musical Works
Musical compositions and copyrights in musical works are generally not capital assets. However, you can elect to treat these types of property as capital assets if you sell or exchange them in tax years beginning after May 17, 2006, and:
Your personal efforts created the property, or
You acquired the property under circumstances (for example, by gift) entitling you to the basis of the person who created the property or for whom it was prepared or produced.
Whistleblower Fees
If you receive an award from the IRS for information provided after December 19, 2006, that substantially contributes to the detection of violations of tax laws by the IRS, you may be able to deduct attorney fees and court costs paid by you in connection with the award, up to the amount of the award includible in your gross income on account of the award, as an adjustment to income.
Frivolous Tax Submissions
For returns filed after March 15, 2007, the penalty for filing a frivolous tax return is increased to $5,000. The $5,000 penalty also applies to other specified frivolous submissions made and issues raised after March 15, 2007.
Notice 2007-30, which will be published in Internal Revenue Bulletin 2007-14, contains a list of frivolous positions that will trigger the increased penalty amount. The penalty is in addition to any other penalty provided by law.
Expired Tax Benefits
Relief granted for Hurricanes Katrina, Rita, and Wilma. The following tax benefits have expired and will not apply for 2007.
*Tax-favored treatment of qualified hurricane distributions from eligible retirement plans.
*Increased limits and delayed repayment on loans from qualified employer plans.
*Special rules so a temporary relocation did not affect whether you provided more than half of an individual's support, whether you furnished more than half the cost of keeping up a household, and whether you could treat an individual as a student.
*Increased limits and an expanded definition of qualified education expenses for the Hope and lifetime learning credits.
*Additional exemption for housing individuals displaced by Hurricane Katrina.
*Exclusion from income for discharge of nonbusiness debt by reason of Hurricane Katrina.
Qualified electric vehicle credit. You cannot claim this credit for any vehicle you placed in service after 2006.
The following changes to the AMT went into effect for 2007.
AMT exemption amount decreased. The AMT exemption amount has decreased to
$33,750 if single
$45,000 if married filing jointly or qualifying widow(er)
$22,500 if married filing separately.
Exemption amount for a child. The minimum exemption amount for a child under age 18 has increased to $6,300.
Hurricane Katrina additional exemption expired. The additional exemption for taxpayers who provide housing for a person displaced by Hurricane Katrina has expired. Therefore, the additional exemption amount (formerly line 6 of Form 8914) is no longer allowable for the AMT.
Certain credits no longer allowed against the AMT. The following credits:
*The credit for child and dependent care expenses,
*credit for the elderly or the disabled,
*education credits,
*residential energy credits,
*mortgage interest credit, and
*the District of Columbia first-time homebuyer credit
are no longer allowed against the AMT, and a new tax liability limit applies. This limit is your regular tax minus any tentative minimum tax (figured without any AMT foreign tax credit).
Standard Mileage Rate
Business-related mileage. For 2007, the standard mileage rate for the cost of operating your car for business use is 48.5 cents per mile.
Medical- and move-related mileage. For 2007, the standard mileage rate for the cost of operating your car for medical reasons or as part of a deductible move is 20 cents per mile.
Charitable-related mileage. For 2007, the standard mileage rate for the cost of operating your car for charitable purposes remains 14 cents per mile.
Earned Income Credit (EITC)
The following paragraphs explain the changes to the credit for 2007.
Amount of credit increased. The maximum amount of the credit has increased. The most you can get is:
$2,853 if you have one qualifying child,
$4,716 if you have more than one qualifying child, or
$428 if you do not have a qualifying child.
Earned income amount increased. The maximum amount of income you can earn and still get the credit has increased for 2007. You may be able to take the credit of $1 to $4 if:
You have two qualifying children and you earn less than $37,783 ($39,783 if MFJ),
You have one and you earn less than $33,241 ($35,241 if MFJ), or
You do not have a qualifying child and you earn less than $12,590 ($14,590 if MFJ).
The maximum amount of adjusted gross income (AGI) you can have and still get the credit also has increased. You may be able to take the credit if your AGI is less than the amount in the above list that applies to you.
Investment income amount increased. The maximum amount of investment income you can have and still get the credit has increased to $2,900 for 2007.
Advance payment of the credit. If you get advance payments of the credit from your employer with your pay, the total advance payments you get during 2007 can be as much as $1,712.
Nontaxable combat pay election extended. You can elect to have your nontaxable combat pay included in earned income when you figure your earned income credit for 2007.
Standard Deduction Amount Increased
The standard deduction for people who do not itemize deductions on Schedule A (Form 1040) is, in most cases, higher for 2007 than it was for 2006.
Exemption Amount Increased
The amount you can deduct for each exemption has increased to $3,400 in 2007.
You lose part of the benefit of your exemptions if your adjusted gross income is above a certain amount. For 2007, the phaseout begins at:
$117,300 for married persons filing separately,
$156,400 for single individuals,
$195,500 for heads of household, and
$234,600 for MFJ or qualifying widow(er)s.
Charitable Contributions
New recordkeeping requirements for cash contributions. You cannot deduct a cash contribution, regardless of the amount, unless you keep as a record of the contribution a bank record (such as a canceled check, a bank copy of a canceled check, or a bank statement containing the name of the charity, the date, and the amount) or a written communication from the charity. The written communication must include the name of the charity, date of the contribution, and amount of the contribution.
Contributions to donor advised funds. You cannot deduct a contribution to a donor advised fund after February 13, 2007, if the sponsoring organization is a war veterans' organization, a fraternal society, or a nonprofit cemetery company. There are also other circumstances in which you cannot deduct your contribution to a donor advised fund.
Filing fee for easements on buildings in historic districts. A new $500 filing fee must be paid for each qualified conservation contribution after February 12, 2007, that is an easement on a building in a registered historic district, if the claimed deduction is more than $10,000.
Social Security and Medicare Taxes
The maximum amount of wages subject to the social security tax for 2007 is $97,500. There is no limit on the amount of wages subject to the Medicare tax.
Income Limits Increased for Student Loan Interest Deduction
For 2007, the amount of the student loan interest deduction is phased out if your MAGI is between $55,000 and $70,000 (between $110,000 and $140,000 if MFJ).
Income Limits Increased for Hope and Lifetime Learning Credits
For 2007, the amount of your Hope or lifetime learning credit is phased out (gradually reduced) if your MAGI is between $47,000 and $57,000 ($94,000 and $114,000 if you file MFJ).
Earned Income Amount for Additional Child Tax Credit
For 2007, the minimum earned income amount used to figure the additional child tax credit has increased to $11,750.
Mortgage Insurance Premium Deduction
Premiums that you pay or accrue for “qualified mortgage insurance” during 2007 in connection with home acquisition debt on your qualified home are deductible as an itemized deduction. The amount you can deduct is reduced by 10% (.10) for every $1,000 ($500 if your filing status is married filing separately) by which your adjusted gross income exceeds $100,000($50,000 if your filing status is married filing separately).
Mortgage insurance premiums you paid or accrued on any mortgage insurance contract issued before January 1, 2007, or accrued after December 31, 2007, or that are properly allocable to any period after December 31, 2007, are not deductible as an itemized deduction.
Qualified mortgage insurance. Qualified mortgage insurance is mortgage insurance provided by the Veterans Administration, the Federal Housing Administration, or the Rural Housing Administration, and private mortgage insurance.
Limit on Itemized Deductions Increased
If your adjusted gross income is above a certain amount, you may lose part of your itemized deductions. In 2007, this amount is increased to $156,400 ($78,200 if MFS).
Health Savings Accounts (HSAs)
High deductible health plan (HDHP). For HSA purposes, the minimum annual deductible of an HDHP increases to $1,100 ($2,200 for family coverage) and the maximum annual deductible and other out-of-pocket expenses limit increases to $5,500 ($11,000 for family coverage).
Deductible limitation on contributions. The annual deductible limitation for contributions to your HSA based on the amount of your health insurance deductible is repealed. For 2007, the maximum HSA deduction increases to $2,850 ($5,650 for family coverage) regardless of the amount of your health insurance deductible. The maximum additional deduction for individuals age 55 or older increases to $800.
Transfers from an individual retirement account (IRA) to an HSA. You can elect to make a one-time direct trustee-to-trustee transfer from your IRA (other than a Simple IRA or a SEP IRA) to your HSA. The maximum amount you can transfer is the maximum HSA contribution limitation for the year. The amount transferred is not included in your income, is not deductible, and reduces your HSA contribution limitation for the year.
Adoption Benefits Increased
For 2007, the maximum adoption credit has increased to $11,390. Also, the maximum exclusion from income for benefits under your employer's adoption assistance program has increased to $11,390.
These amounts are phased out if your MAGI is between $170,820 and $210,820.
Income Limits Increased for Reduction of Education Savings Bond Exclusion
For 2007, the amount of your interest exclusion is phased out (gradually reduced) if your filing status is MFJ or qualifying widow(er) and your MAGI is between $98,400 and $128,400.
For all other filing statuses, your interest exclusion is phased out if your MAGI is between $65,600 and $80,600.
Credit for Prior Year Minimum Tax
If you have any unused minimum tax credit carry forward from 2003 or earlier years, your minimum tax credit allowable for 2007 is not less than the “AMT refundable credit amount.” In addition, a portion of the credit may be refundable in 2007.
Increase in Deductible Limit for Long-Term Care Premiums
For 2007, the maximum amount of qualified long-term care premiums you can include as medical expenses has increased. You can include qualified long-term care premiums, up to the amounts shown below, as medical expenses on Schedule A (Form 1040).
*Age 40 or under - $290.
*Age 41 to 50 - $550.
*Age 51 to 60 - $1,110.
*Age 61 to 70 - $2,950.
*Age 71 or over - $3,680.
Note. The limit is for each person.
Increase in Limit on Long-Term Care and Accelerated Death Benefits Exclusion
The limit on the exclusion for payments made on a per diem or other periodic basis under a long-term care insurance contract increases for 2007 to $260 per day.
The limit applies to the total of these payments and any accelerated death benefits made
on a per diem or other periodic basis under a life insurance contract because the insured is chronically ill.
Archer MSA Limits Increased
For Archer MSA purposes for 2007, the minimum annual deductible of a high deductible health plan increases to $1,900 ($3,750 for family coverage).
The maximum annual deductible of a high deductible health plan increases to $2,850 ($5,650 for family coverage).
The maximum out-of-pocket expenses limit increases to $3,750 ($6,900 for family coverage).
Capital Asset Treatment for Self-Created Musical Works
Musical compositions and copyrights in musical works are generally not capital assets. However, you can elect to treat these types of property as capital assets if you sell or exchange them in tax years beginning after May 17, 2006, and:
Your personal efforts created the property, or
You acquired the property under circumstances (for example, by gift) entitling you to the basis of the person who created the property or for whom it was prepared or produced.
Whistleblower Fees
If you receive an award from the IRS for information provided after December 19, 2006, that substantially contributes to the detection of violations of tax laws by the IRS, you may be able to deduct attorney fees and court costs paid by you in connection with the award, up to the amount of the award includible in your gross income on account of the award, as an adjustment to income.
Frivolous Tax Submissions
For returns filed after March 15, 2007, the penalty for filing a frivolous tax return is increased to $5,000. The $5,000 penalty also applies to other specified frivolous submissions made and issues raised after March 15, 2007.
Notice 2007-30, which will be published in Internal Revenue Bulletin 2007-14, contains a list of frivolous positions that will trigger the increased penalty amount. The penalty is in addition to any other penalty provided by law.
Expired Tax Benefits
Relief granted for Hurricanes Katrina, Rita, and Wilma. The following tax benefits have expired and will not apply for 2007.
*Tax-favored treatment of qualified hurricane distributions from eligible retirement plans.
*Increased limits and delayed repayment on loans from qualified employer plans.
*Special rules so a temporary relocation did not affect whether you provided more than half of an individual's support, whether you furnished more than half the cost of keeping up a household, and whether you could treat an individual as a student.
*Increased limits and an expanded definition of qualified education expenses for the Hope and lifetime learning credits.
*Additional exemption for housing individuals displaced by Hurricane Katrina.
*Exclusion from income for discharge of nonbusiness debt by reason of Hurricane Katrina.
Qualified electric vehicle credit. You cannot claim this credit for any vehicle you placed in service after 2006.
2008 General Tax Calendar
Federal holidays in 2008
January 14 — IRS starts to process 2007 income tax returns that are filed without any of following five forms
April 15 — Due date for 2007 income tax return and any tax owed.
January 1 — New Year’s DayGeneral tax calendar of 2008
January 21 — Birthday of Martin Luther King, Jr.
February 18 — Washington’s Birthday
April 16 — District of Columbia Emancipation Day
May 26 — Memorial Day
July 4 — Independence Day
September 1 — Labor Day
October 13 — Columbus Day
November 11 — Veterans’ Day
November 27 — Thanksgiving Day
December 25 — Christmas Day
January 14 — IRS starts to process 2007 income tax returns that are filed without any of following five forms
Form 8863, Education CreditsFebruary 11 — IRS starts to process income tax returns that has filed with any of above five forms.
Form 5695, Residential Energy Credits
Form 1040A’s Schedule 2, Child & Dependent Care Expenses for Form 1040A filers
Form 8396, Mortgage Interest Credit
Form 8859, District of Columbia First-Time Homebuyer Credit
April 15 — Due date for 2007 income tax return and any tax owed.
OR file Form 4868 "Automatic Extension of Time to File Your Tax Return" and pay any tax due.October 15 — File the income tax return if you had filed the Form 4868 by April 15.
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