There are a number of changes in the tax code for 2007.  Below I’ve highlighted the ones that will affect the most people.

• AMT exemption - The amount for AMT exemption has been raised for one year only.  The new limits are $66,250 for married filing jointly, $33,125 for married filing separately and $44,350 for single and head of household.

• Charitable contributions - Now documentation is required for ALL donations, cash and non-cash.  This can be in the form of bank records or a receipt from the recepient organization.

• Mortgage forgiveness - Now, up to $2 million of debt on a primary residence can be forgiven ($1 million for married filing separately).  This is in effect for debt forgiven during 2007, 2008 or 2009.

• Personal exemptions - Exemptions have increased to $3400 for both the taxpayer and any qualified dependents.

• Private mortgage insurance (PMI) - PMI is now tax-deductible for mortgages originated or refinanced during 2007.  However, this does not apply for taxpayers with an AGI over $100,000 (or $50,000 if married filing separately).

• Saver’s credit - The income limit has been increased to adjust for inflation.

• Standard deduction - The standard deduction has increased to $10,700 for married filing jointly, $5350 for single and married filing separately, and $7850 for head of household.

• Standard mileage rates - The mileage rate for business use of a vehicle has increased to 48.5 cents per mile.  The mileage rate for medical reasons or a qualified move has increased to 20 cents per mile.