Get May 1997) Department Of The Treasury Internal Revenue Service Note: Do Not Use This For M To Get

The top marginal long term capital gains rate fell from 28% to 20%, subject to certain phase-in rules. The 15% bracket was lowered to 10%. The act permanently exempted from taxation the capital gains on the sale of a personal residence of up to $500,000 for married couples filing jointly and $250,000 for singles.

Key Takeaways. Most of the tax breaks in the 1997 act went to middle- and low-income taxpayers. The Roth IRA, the child tax credit, and education savings accounts were all introduced. Capital gains taxes were reduced, as the tax treatment of housing capital gains was also changed.

Most IRS letters and notices are about federal tax returns or tax accounts. Each notice deals with a specific issue and includes specific instructions on what to do. A notice may reference changes to a taxpayer's account, taxes owed, a payment request or a specific issue on a tax return.

Exclusion for sales after May 6, 1997. If you sell your main home after May 6, 1997, you may be able to ex- clude any gain from income up to a limit of $250,000 ($500,000 on a joint return in most cases).

Those various provisions of TRA-97 phase in over different periods, but all will be fully effective by 2007. The Taxpayer Relief Act provides tax incentives for various types of activities: investment in postsecondary education, saving for retirement, long-term capital investment, and the hiring of low-wage workers.

The IRS sends notices and letters for the following reasons: You have a balance due. You are due a larger or smaller refund. We have a question about your tax return.

Prior to 1997, taxpayers were required to reinvest home sale proceeds to avoid paying taxes on the financial gain. However, the Taxpayer Relief Act of 1997 now allows you to exclude $250,000 from the sale in you are single, and $500,000 if you file joint taxes with a spouse.