Tax

The alternative minimum tax isn't the only tax that will continue to surprise taxpayers if Congress fails to act on its repeal. The estate tax, currently set to expire in 2010, will return with a vengeance to a full 55 percent in 2011 if Congress does nothing.The Joint Committee on Taxation estimated that in 2009 there will be 9,600 estates subject to the estate tax. While that number falls to zero in 2010, it will jump to nearly 62,000 in 2011, with increases every year thereafter.

Since this is our first column of the New Year, it may be particularly appropriate to look back into 2007 to try to predict some of what will happen in 2008. The history of important tax developments that took place in 2007 is rich and varied. Shakespeare's "What is past is prologue" was never so apt.In that spirit, we have selected 10 developments as standouts in terms of their impact on the future, and especially on 2008 tax strategies. We explain each of these top 10 below. And, of course, respecting the difficulty of prioritizing just 10 2007 tax developments as most significant, we conclude by listing several more as runners up!

Intuit said its Lacerte and ProSeries professional tax prep products would flag any returns that cannot be filed until mid-February because of the delayed patch for the alternative minimum tax.

President Bush is reportedly mulling an economic stimulus package that could include further tax cuts this year.

The Internal Revenue Service and the Treasury Department have released final regulations and a revenue procedure requiring tax preparers to obtain consent before they can distribute taxpayer information to third parties, along with a proposal to restrict the marketing of refund anticipation loans and similar products.

The Internal Revenue Service kicked off tax season this week, saying it plans to mail 16.5 million tax packages to taxpayers this month who have filed paper returns in the past, but the packages won't include any tax credit forms because of delays in patching the alternative minimum tax.

Banking giant HSBC USA has said it would sell its Wealth and Tax Advisory Services USA business to some of its managing directors for up to $65.9 million as part of a management buyout.

The Treasury Department said a new income tax treaty and protocol with Belgium has gone into effect, along with three protocols amending existing tax treaties with Germany, Denmark and Finland.

The president of a company that hosted tax forums for the Internal Revenue Service has been sentenced to five years in prison for defrauding the IRS of more than $1 million.

The American Institute of CPAs has written to the Internal Revenue Service and the Treasury Department requesting them to revise their proposed regulations on foreign tax credits.