Current Tax Rates

*Years Beginning in......................................*	2002	2003	2004	2005	2006
Section 179 Expense Deduction:
Total purchase limit for full expensing deduction			$410,000	$420,000
Taxpayers other than estates, trusts and certain non- corporate lessors are allowed to deduct as expense, rather than depreciate, up to the following:	$24,000	$100,000	$102,000	$105,000
Tax Credits:
Hope Scholarship Credit (per child)	$1,500	$1,500	$1,500	$1,500
Adoption Credit		$10,160	$10,390	$10,630	$10,390+cola
Maximum amount of expenses that will qualify for the 20% Lifetime Learning Credit	$5,000	$10,000	$10,000	$10,000	$10,000
Taxation of Employee Benefits:
Employer provided PARKING is taxable if the monthly worth for company employees exceeds	$185	$190	$195	$200
Employer provided TRANSPORTATION is taxable if the monthly worth for company employees exceeds	$100	$100	$100	$105
*IRS mileage allowance rates (i.e. cents per mile)*
BUSINESS	36.5¢	36¢	37.5¢	40.5¢ 1-1 to 8-31
BUSINESS				48.5¢ 9-1 to 12-31
CHARITABLE	14¢	14¢	14¢	14¢
MEDICAL	13¢	12¢	14¢	15¢
MOVING	13¢	12¢	14¢	15¢
Years beginning in .............................	2002	2003	2004	2005	2006
Percentage Deduction Allowed to Self-Employed Individuals for their Health Insurance	70%	100%	100%	100%	100%
IRA Contribution Limit ( if under age 50 )	$3,000	$3,000	$3,000	$4,000	$4,000
IRA Contribution Limit ( if age 50 and over )	$3,000	$3,000	$3,500	$4,500	$5,000
SIMPLE Contribution Limit ( if under age 50 )			$9,000	$10,000
SIMPLE Contribution Limit ( if age 50 and over )			$10,500	$12,000
Maximum 401(k) Plan contribution amount ( Taxpayer under age 50 )			$13,000	$14,000
Maximum 401(k) Plan contribution amount ( Taxpayer age 50 and up )	$12,000	$14,000	$16,000	$18,000	$20,000
Maximum Benefit Funded Limit for defined benefit plan under section 415(b)	$160,000	$160,000	$165,000	$170,000
Maximum Dollar Limit for defined contribution plans under section 415(c)(1)(A)	$40,000	$40,000	$41,000	$42,000
Minimum annual comp. for plan participants in a SEP			$450	$450
Maximum Wage Base For Retirement Contribution	$200,000	$200,000	$205,000	$210,000
Social Security Benefits, Rates, Etc.:
Cost of living adjustment	1.40%	2.10%	2.10%	2.70%
Social Security Rates:
OASID PORTION	6.20%	6.20%	6.20%	6.20%
MEDICARE PORTION	1.45%	1.45%	1.45%	1.45%
COMBINED	7.65%	7.65%	7.65%	7.65%
SELF-EMPLOYMENT	15.30%	15.30%	15.30%	15.30%
Years beginning in .............................	2002	2003	2004	2005	2006
Wage Base:
OASID PORTION	$84,900	$87,000	$87,900	$90,000
MEDICARE PORTION	No Limit	No Limit	No Limit	No Limit	No Limit
*Maximum Earnings B4 Losing Benefits:*
UNDER AGE 65	$11,280	$11,520	$11,640	$12,000
AGE 65+2 months and OVER	No Limit	No Limit	No Limit	No Limit	No Limit
Year of full retirement age. NOTE: Applies only to earnings for months prior to attaining full retirement age. One dollar in benefits will be withheld for every $3 in earnings above the limit.			$31,080	$31,800
*Earnings Reduction*
AGES 62-64	$1 of benefits for $2 of earnings	$1 of benefits for $2 of earnings	$1 of benefits for $2 of earnings	$1 of benefits for $2 of earnings
AGES 65+2 months	No Limit	No Limit	No Limit	No Limit
Maximum Social Security Benefit NOTE: For retirees born in 1939, full retirement age is 65 and 4 months; for those born in 1940, it is 65 and 6 months. Full retirement age will gradually increase to age 67 for those born in 1960 and later.	$1,660/mo.	$1,741/mo.	$1,825/mo. (Age 65 and 4 months	$1,939/mo. (Age 65 and 6 months
Average Monthly Social Security Benefits
ALL RETIRED WORKERS	$874	$903	$930	$955
OLDER COUPLE, BOTH RECEIVING	$1,454	$1,492	$1,532	$1,574
WIDOW(ER)	$841	$888	$896	$920
Years beginning in .............................	2002	2003	2004	2005	2006
"Kiddie Tax" Exemption	$1,500	$1,500	$1,600	$1,600
EDUCATION LOAN INTEREST DEDUCTION	$2,500	$2,500	$2,500
Maximum deduction for qualified higher education expenses	$3,000	$3,000	$2,000$4,000	$2,000$4,000
EDUCATION SAVINGS ACCOUNT CONTRIBUTION	$2,000	$2,000	$2,000	$2,000	$2,000
Medicare Part A deductible for inpatient hospital care	$812	$840	$876	$912
Medicare Part A daily hospital costs for days 61-90	$203	$210	$219	$228
Medicare Part A daily hospital costs for days over 90	$406	$420	$438	$456
Medicare Part B Monthly Premium	$54.00	$58.70	$66.60	$78.20
Minimum Quarterly Earnings 2Qualify 4Social Security	$870	$890	$900	$940
Quarter Credits For Eligible Retirement	40	40	40	40	40
Unemployment Taxes:
Federal (FUTA)- Tax Base	$7,000	$7,000	$7,000	$7,000
Federal (FUTA)- Tax Rate	0.8%	0.8%	0.8%	0.8%
SUTA (Ohio)- Tax Base	$9,000	$9,000	$9,000	$9,000
Years beginning in .............................	2002	2003	2004	2005	2006
Luxury Auto Excise Tax (Federal):	................	................	................	..............	.............
Threshold	$40,000	Expired	Expired	Expired	Expired
Excess Rate above Threshold	3%	Expired	Expired	Expired	Expired
IRS Charges / Penalties:
For a copy of a tax return ( Form 4506 )	$23	$23	$39	$39
For each failure to file form 1099 maximum penalty $250,000 per year ($100,000 for small businesses).	$50	$50	$50	$50
"Flat Tax Rate" on Personal Service Corporation	35%	35%	35%	35%
Nanny Tax:
Employers of Domestic help must withhold payroll taxes if employees wages, per year, will exceed	$1,300	$1,400	$1,400	$1,400
Years beginning in .............................	2002	2003	2004	2005	2006
ESTATE & GIFT TAXES:
Generation-Skipping Exemption	$1,100,000	$1,120,000	$1.5 million	$1.7 million
Amount of cumulative transfers exempt from Estate tax	$1million	$1million	$1.5 million	$1.5 million	$2million
Top Estate Tax Rate	50%	49%	48%	47%	46%
Annual Gift Tax Exclusion	$11,000	$11,000	$11,000	$11,000
Amount of cumulative transfers exempt from Gift tax	$1million	$1million	$1million	$1million	$1million
Sales & Use Taxes: ( including 1% Ohio state tax)
Ashtabula County	7.00%	7.00%	7.00%	6.50%
Cuyahoga County	8.00%	8.00%	8.00%	7.50%
Geauga County	6.50%	6.50%	6.50%	6.50%
Lake County	6.75%	6.75%	6.75%	6.25%
Lorain County	6.75%	6.75%	6.75%	6.25%
Summit County	6.75%	6.75%	6.75%	6.25%
Minimum Wage (Federal):
Increased on September 1, 1997 to $5.15				$5.15^a
^a A subminimum wage -- $4.25 an hour -- is established for employees under 20 years of age during their first 90 consecutive calendar days of employment with an employer.			$4.25
Increased on October 1, 1996 to $4.75		$4.75
Increased on April 1, 1991 from $3.80 to $4.25	$4.25

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