Tax Law Changes for 2007

IRS Tax Law changes:

1. The gift tax annual exclusion is $12,000 for 2006.

2. The capital gains rate of 15% was extended through 2010. For 2006 taxpayers in the 10%-15% tax rate will pay 5% tax on capital gains.

3. Business mileage is $.445 for 2006 and will be $.485 for 2007 (check Pub. 463).

4. Telephone Excise Tax Refund (TETR) is a one-time payment available on your 2006 federal income tax return. It is designed to refund previously collected long distance telephone taxes. Individuals, businesses and tax-exempt organizations are eligible to request it. Businesses and tax-exempts can dig through their old bills. Or they can review their bills for 2 months and use a special formula to figure the refund.

For more information on any of these topics go to www.irs.gov .

While you are there, check out Publication 523“ Selling a Home."

New California Laws:

1. Minimum Wage will be $7.50 for 2007 and $8.00 for 2008. Looks like I will get a raise.

2. Assembly Bill 1169 “ This law reestablishes the sixty (60) day notice which is required by landlords to give to residential tenants on periodic leases (e.g., month-to-month lease) when the tenants have been living in the property forat least one year. This law maintains the exception of a thirty (30) day notice for certain qualifying properties for sale."

3. Assembly Bill 2429 “ No more conditional Real Estate Licenses after 10/1/07."

4. Senate Bill 1609 “ This law provides protection to consumers who obtain reverse mortgages."

5. Assembly Bill 2618 “ This new law essentially is clean-up legislation which increases the jurisdictional limit in small claims court to $7,500 on certain issues which were left unchanged when general limits increased from $5,000 to $7,500 last year."

For more information on these bills go to www.leginfo.ca.gov/bilinfo.html.