5 New Tax Law Changes Affect You

West Essex Tribune
October 13, 2005

There have been several recent tax law changes you ought to know about. Among them are:

  1. The limitation on most charitable donations of 50% of Adjusted Gross Income has been changed to a limit of 100% of Adjusted Gross Income for donations made from August 28, 2005 to December 31, 2005.
  2. The itemized deduction phase-out for most charitable donations made from August 28, 2005 to December 31, 2005 has been eliminated.
  3. These changes mean it may be the ideal time for you to consider a charitable remainder trust that pays you an annuity for your lifetime and gives you a current charitable donation income tax deduction.
  4. The standard mileage rate for business use of your car has been raised from 40.5 to 48.5 cents per mile effective September 1, 2005.
  5. The annual gift tax exclusion is increased beginning January 1, 2006 to $12,000. That means you can give $12,000 each to as many people as you want with no federal gift tax consequences.
  6. The federal estate tax exemption will increase to $2,000,000 effective January 1, 2006. However, the New Jersey estate tax exemption remains only $675,000, so if your total assets, including your home, retirement plans and life insurance are more than $675,000 you need to plan avoid unnecessary taxes.

For more information contact the Law Offices of Jonathan Bressman LLC, 973-660-1919 email at This email address is being protected from spambots. You need JavaScript enabled to view it. or visit his website at estatelawnj.com.

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