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The major new laws of 2005 were
prompted by Mother Nature.
The violent hurricane season wreaked havoc
on millions of coastal residents, motivating lawmakers
to enact measures to help out the storm victims. In
the process, they also added some storm-related breaks
for the rest of the country's taxpayers.
The Internal Revenue Service also issued a couple of
rulings that many taxpayers will welcome, such as increased
mileage deduction rates and an easier way to put off
the inevitable task of filing.
But other changes, most notably the new
tax definition of a child, will cause some filers extra
effort and potentially costly headaches.
There's also one welcome change that's due simply to
the calendar. This year, April 15 falls on a Saturday,
pushing the filing deadline to the next business day,
Monday, April 17.
Now that you have all that spare time,
let's put it to use by looking at 10 tax changes that
could make a difference on your 2005 return and to your
2006 tax planning.
Tax help for hurricane victims
There are myriad hurricane-related new tax provisions
to help the millions of 2005 storm victims. The changes
include ways for people to cover their immediate living
expenses, pay longer-term recovery costs and take advantage
of other benefits on their tax returns.
The measures apply to specially designated
areas: the Gulf Opportunity, or GO, Zone, the Rita GO
Zone, the Wilma GO Zone and separate disaster areas
for these three hurricanes, affecting residents in Alabama,
Florida, Louisiana, Mississippi and Texas.
The various new laws and geographic eligibility
standards mean that storm victims will have to do extra
work to make sure they find and utilize tax benefits
specific to their situations. The Internal Revenue Service
has a Web
page with details, but here are some of the major
provisions and how they could help.
| At right are the
biggest changes in the tax code that can make
a difference for people filing their 2005
returns -- or doing their 2006 tax planning.
Some will help you save money, others will
cost you, in headaches and paperwork, if not
in cash. |
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