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Brought
to you by:
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About Our Firm:
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We are a client-centric financial planning firm with a focus on safety and stability. We can directly fulfill the portions of the planning that includes mortgage and insurance services. Our affiliates manage any tax planning, estate planning, securities and investments services, or we coordinate with your preferred providers.
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| QUOTES from
the
Masters... |
| On Commitment |
On Concentration/Focus |
| "A
commitment is like your signature on a contract: it binds you to a
course
of action." -– Nido
Qubein
"Choose
a field you enjoy and then become totally absorbed in it." -–
Brian Tracy
"A
total commitment is paramount to reaching the ultimate in performance."
-– Tom Flores
"All
great masters are chiefly distinguished by the power of adding a
second,
a third, and perhaps a fourth step in a continuous line. Many a man had
taken the first step. With every additional step you enhance
immensely
the value of your first." -– Ralph
Waldo
Emerson
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"The
weakest living creature, by concentrating his powers on a single
object,
can accomplish something; whereas the strongest, by dispersing his over
many, may fail to accomplish anything." -– Thomas
Carlyle
"Give
whatever you are doing and whoever you are with the gift of attention."
-– Jim Rohn
"Devote
uninterrupted chunks of time to the most important people in your
life."
-– Brian Tracy
"Our
grand business is not to see what lies dimly at a distance, but to do
what
lies clearly at hand." -- Thomas
Carlyle
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Alternative
Minimum Tax Relief
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The
2003 Tax Act (Jobs and Growth Tax Relief Reconciliation Act of 2003 -
JGTRRA)
was signed into law in May 2003, followed more recently by the Working
Families Tax Relief Act of 2004 (WFTRA), which was signed into law in
October
2004, and the Tax Increase Prevention and Reconciliation Act of 2005,
signed
into law in May 2006.
As
is typical of recent tax legislation, the 2003, 2004 and 2005 Tax Acts
offered tax relief to individuals, but did so through a variety of
complex
provisions that included retroactive, temporary and
phased-in/phased-out
effective dates. While some of these provisions may not apply to
you, other provisions will and you may want to revise your planning to
take full benefit of those provisions.
Today's topic
is alternative minimum tax relief. If you would like additional
information
on this topic, please call my office.
Alternative Minimum
Tax Relief
The objective
of the alternative minimum tax (AMT) is to
ensure that taxpayers with itemized deductions and/or income from
certain
tax preferences will not avoid or defer all tax liability, but instead
will pay a minimum tax. The AMT applies if certain tax benefits,
when added back to income, result in an AMT tax that exceeds the
regular
income tax.
The alternative
minimum tax rate is:
- 26%
on the first $175,000 ($87,500 married filing separately) of AMT
income,
after the AMT exemption; and
- 28%
on AMT income over $175,000 ($87,500 married filing separately).
While
each taxpayer receives an AMT
exemption,
increasing numbers of middle-income taxpayers are being hit with the
AMT,
the provisions of which are not indexed for inflation.
The
Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA)
provided only minimal AMT relief by modestly increasing the AMT
exemption for 2001 - 2004. While the Jobs and Growth Tax Relief
Reconciliation Act of 2003 (JGTRRA) again increased the AMT exemption,
but only for 2003 - 2004, the Working Families Tax Relief Act of 2004
(WFTRA) extended the increased AMT exemption through 2005. The
Tax Increase Prevention and Reconciliation Act of 2005 (TIPRA) again
extended and also increased the AMT exemption, but only for the 2006
tax year. Legislation passed at the end of 2007 again extended
and increased the AMT exemption, but only for the 2007 tax year. It is unknown if Congress will again extend an increased AMT exemption for the 2008 tax year.
The
AMT exemption is based on filing status and is reduced by 25 cents for
each $1 of income subject to AMT that exceeds specified amounts:
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AMT
Exemption Amount
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| Filing
Status |
2006
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2007
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2008
and later
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Reduced
by 25% of AMT Income Over:
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Eliminated
if AMT Income Exceeds:
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| Married
filing jointly and qualifying widow(er) |
$62,550
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$66,250
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$45,000
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$150,000
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$330,000
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| Single
and head of household |
$42,500
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$44,350
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$33,750
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$112,500
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$247,500
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| Married
filing separately |
$31,275
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$33,125
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$22,500
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$75,000
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$165,000
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Planning
Notes:
| 1. |
Unfortunately, there
are
no specific tests to indicate AMT liability. If you claim
itemized
deductions and/or certain tax preference items, you must first figure
your
regular income tax and then calculate AMT. If AMT exceeds your
regular
tax, your tax liability is increased by the difference. |
| 2. |
According to
projections,
unless a future Congress takes action to reform the AMT, millions more
taxpayers will become subject to the alternative minimum tax in its
current
form. |
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| MESSAGES
from
the Masters... |
PLANNING
YOUR TIME by Tom Hopkins
Make
it a firm habit to sit down for a few minutes every evening to plan
what
you must do tomorrow. List them in the order of importance.
This is the one and only system many highly successful people use.
To
get yourself organized, list all the things you can do and learn to
make
yourself more effective. Work out a schedule that will get them
done
or learned in the shortest possible time.
When
you start making lists the night before, your subconscious mind will
work
on your list all night without disturbing your sleep to help you solve
your problems and achieve your goals. Your subconscious, however,
can't help unless you tune it in to what's going to happen next.
Give
this process several days to start flowing. Go over your list in
a quiet room. See yourself involved with the most difficult part
of each thing on your list. Make the sessions brief and
upbeat.
See yourself happily enjoying the fact that you've successfully
accomplished
each of your goals for tomorrow.
Don't
concentrate on fear and dread of what you have to do. If you do
that,
your subconscious may figure out ways to make you forget or otherwise
avoid
meeting what is sees as painful experiences.
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The purpose
of this newsletter
is to provide information of general interest to our clients, potential
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general
in nature and should not be considered complete information on any
product
or concept described. For more complete information, please
contact
my office at the phone number above.
Financial Advisor Certified Mortgage Planner Private Real Estate Banker/Investor Licensed Life, Health & Annuity Agent FINRA (formerly NASD) is located at www.finra.org.
SIPC is located at www.sipc.org.
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