Summary of 2007 Tax Changes:
- Tax relief is available to struggling homeowners whose mortgage debt is forgiven.
- Retirement savings incentives expand.
- A new deduction is available for some mortgage insurance premiums. And
- New recordkeeping rules apply to cash donations to charity.
AMT Exemption Increased for One Year
For tax-year 2007, Congress raised the alternative minimum tax exemption to $66,250 for a married couple filing a joint return, up from $62,550 in 2006. The exemption rises to $33,125 for a married person filing separately, up from $31,275, and it rises to $44,350 for singles and heads of household, up from $42,500. Under current law, these exemption amounts will drop to $45,000, $22,500 and $33,750, respectively, in 2008. <