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The special Child Tax Credit is still available for married tax payers with income less than $110,000 and single less than 75,000.
Unfortunately CA State income taxes remain one of the highest in America.
For this year of 2012 SOCIAL SECURITY TAX will be deducted from your paycheck all the way up to $110,110, but at a lower percentage this year.
Save for the future with a Roth IRA contribution. These are not deductible now, but are tax free for life. Special rules also pertaining to IRAs pertain to the Roth IRA.
For 2011 and 2012 you can contribute $5,000 to a Roth or Traditional IRA and for age 50 and over you can contribute up to $6,000. High income earners do not qualify.
For self-employed individuals the maximum contribution to your SEP is $49,000 in 2010.
401(k) Plan Contributions to your 401(k) plan at work will now allow up to $16,500 per year for 2011 and for 2012 it is $17,000. For those aged 50 and older you can make an additional catch-up contribution of $5,500.
The automobile business mileage expense deduction for 2011 was 51 cents per mile.
For 2012 it is 55.5 cents per mile.
Up to $2,500 of interest on qualified Student Loans can be deducted. The deduction phases out on joint returns between $120,000 and $150,000 & on single returns between $60,000 and $75,000.
College education credits: These credits can be taken if your income is below $120,000 if married and $60,000 for single filers.
The amount you can deduct for each personal and dependent exemption is still $3,700 in 2011.
Renter's credit for state tax is again available. $60 for single taxpayers that are under $35,659 income. $120 for joint filers less than $71,318.
Estate Tax Exemption: for 2010—there was NO ESTATE TAX at all, and for 2011 there is a $5,000,000 exemption & 35% tax on assets remaining above that amount.
Annual Gift Tax Limit: you can give up to $13,000 per person (This is not a tax deduction but saves on your estate tax when you die).
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