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March 2006 Newsletter continued |
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EDITOR'S NOTE: Should you have questions with respect to the information contained in this newsletter or need help with your personal or business financial, tax and accounting activities, please call. |
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E-Mail Halliday@hallidaycpa.com |
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This newsletter offers factual and up-to-date information on the subjects discussed, but should not be regarded as a complete analysis of these subjects. No party assumes liability for any loss or damage resulting from reliance or use of this material. |
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Social security wage base increases |
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The social security wage base is expected to be $98,700 for 2007, up from $4,500 from this year’s figures. That is the official forecast from President Bush’s budget, based on data supplied by the Social Security Administration. The tax rates will not change, 7.65% on employers and employees alike.
If you are doing long-range planning, the government is estimating a wage base of $103,500 for 2008, $108,600 for 2009 and $114,000 for 2040. |
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Early home sales can receive a tax break |
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Home sales due to “unforeseen circumstances” can still receive a tax break even though the home is not lived in for 2 years. The IRS is lenient on instances that qualify for this relief as demonstrated by two recent rulings.
A reduced exclusion is approved for taxpayers in a seniors-only community who had to sell their home after circumstances forced their child and grandchild to live with them. And also for a couple from out of state who did not realize their new home was in a high-crime area. They sold their home after neighbors assaulted them. |