California Real Estate
Withholding:

California requires a 3-1/3 % of
gross sales price withholding on real
estate sales.  The only exemptions
from this withholding are for a
personal residence or investment
property structured as a tax-free
exchange under IRC 1031.  This is
an estimated tax and is then claimed
when you file the tax return that
reports the sale.

Car donations:

For car donations in 2005 the
American Jobs Creation Act of 2004
has altered the rules.  If the claimed
value of the donated motor vehicle,
boat or plane exceeds and the item is
sold by the charitable organization,
the taxpayer is limited to the gross
proceeds from the sale.  

Estate taxes:

Estate Tax Exclusion:
2005                      $1,500,000    
2006                          $2,000,000

The annual gift limit per donee has
remained the same at $11,000.  You
may give more but a gift tax return
will need to be filed.

We want to thank you all for your
continued support and business.  
Completax is completing it’s 25th
year in business and it goes without
saying that our clients are our
greatest asset.  Thank you also for
the new business referrals; this is
one of the best compliments we can
receive.
JUNE 2005 NEWSLETTER    
Completax Planning, Inc.
1100 Lincoln Avenue
Suite 104
Napa, CA 94558

707-257-3995
800-244-3995
707-257-1306 fax
Send us an E-Mail
For our first newsletter for 2005 we
thought we would outline some of the
important tax issues for 2005.

Mileage rates:
        Business     40.5 cents/mile
          Medical       15.0 cents/mile
          Charitable   14.0 cents/mile

The 3-cent increase in the business
mileage rate was the largest one-year
increase ever.

Standard deduction:

The standard deduction for 2005 is
projected to be:
Single filing                      $5,000           
Married filing separate     $5,000
Head of Household          $7,300      
Married, filing jointly         $10,000

This deduction is used for taxpayers
who do not itemize their deductions.

Retirement plan contributions:

Traditional IRA (under age 50)   $4,000
Traditional IRA (over age 50)     $4,500
Roth (under age 50)                   $4,000
Roth (over age 50)                     $4,500

There are some limitations to the above
maximum contributions due to adjusted
gross income levels.  Also, whereas
traditional IRAs prohibit contributions
for taxpayer’s that are 70½ or older,
Roth contributions are allowed
regardless of age.

SEP                        25% of wages or
                         20% of SE income  
401K  (under age 50)              $14,000
401K (over age 50)                 $18,000
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