The “Tax Increase Prevention and Reconciliation Act” (TIPRA) was signed into law by the President on May 17, 2006. The most talked about provisions in this law were the short-term alternative minimum tax relief for 2006 and the extension of the current low-taxed capital gains and dividends rate that was due to expire after 2008. However, it also carried a number of other changes affecting individuals and businesses, and included corporate and foreign provisions, technical corrections and extensions of several provisions. Some of these are:

• kiddie tax age limit raised from under 14 to under 18 for tax years beginning after Dec. 31, 2005.  

• income limit on Roth IRA conversions eliminated for tax years beginning after Dec. 31, 2009.

• extension of increased Code Sec. 179 expensing for small business through the end of 2009. 

• modification of the 50% W-2 wage limit on the Code Sec. 199 domestic production deduction, effective for tax years beginning after May 17, 2006. 

• information reporting required for tax-exempt interest after Dec. 31, 2005. 

• changes for corporate estimated tax payments due on Sept. 15, 2010 and Sept. 15, 2011. 

• capital gain treatment allowed for self-created musical works at the taxpayer's election for a pre-Jan. 1, 2011 sale or exchange in tax years beginning after May 17, 2006. 

• amortization of expenses paid for musical works and copyrights for tax years beginning after Dec. 31, 2005 and before Jan. 1, 2011. 

• the active business test for a tax-free corporate spin-off is simplified for distributions made after May 17, 2006 and before Jan. 1, 2010. 

• changes (some not favorable to taxpayers) to the foreign earned income exclusion and housing allowance for U.S. citizens working abroad for tax years beginning after Dec. 31, 2005.