Congress passes Tax Act including key Tax provisions!

On December 9^th, Congress passed the Tax Relief and Health Care Act of 2006. This bill extended several tax provisions that expired at the end of 2005 and modified several others. The following provisions received an extension:

• Earned Income Tax Credit for Combat Pay
• Educator expense deduction
• Energy related Tax provisions
• New Market Tax Credit (ends in 2006)
• Qualified Zone Academy Bonds
• Research Tax Credit
• State and local sales tax deduction
• Tuition and fees deduction
• Welfare-to-work Tax Credit
• Work Opportunity Tax Credit

* The Welfare-to-work Tax Credit and Work Opportunity Tax Credit will be combined for 2007.

* The State and local sales tax deduction is most useful for residents of: Alaska, Florida. Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming since these states do not have a state income tax that can be deducted.