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HomeMy WebLinkAboutThe Lucknow Sentinel, 1987-08-26, Page 10Page 10—Lucknow Sentinel, Wednesday, August 26, 1987 Tax Reform will create major change TAX REFORM AND CAPITAL GAINS Tax Reform will create some major changes in the taxation of capital gains. Since 1972, one half of any capital gain has been added to income and taxed at normal income tax rats. Starting in 1985, this tax- able half has been exempt subject to per- sonal limitations. For owners of qualified farm property, the so called $500,000 ex- emption covered the taxable half of the. capital gain for most farmers. Starting in 1986, the non taxable half of capital gains has been brought back into income and subjected to the minimum per- sonal tax calculations. In 1986 some people who had no regular tax to pay, were sub- ject to minimum tax -because of the new rules. If tax reform prof osals become law, the taxable portion of capital gains will be in- creased to 2/3 in 1988 and -1989 to 3/4 in 199Q. Presumably only 1/3 of the gain in 1988 and 1989 and 1/4 of the gain in 1990 and beyond will be subject to minimum tax. Because �f the retention of the $500,000 ex- emption, farmers with only modest capital gains may escape both regular and minimum tax. Personal capital gain exemptions will be changed too. For regular capital gains such as shares in a public company the ex- emption will be frozen at the 1987 level of $100,000 and will not grow to the proposed level of $500,000. Qualified farm property will remain unchanged at $500,000. Small business corporations will be increased to $500,000 to equal farming. For farm pro- perty bought after June 17, 1987 there will be tougher rules requiring close to full time farming to attain the $500,000 exemp- tion on this new property. If selling farm land in 1987, the rules are exactly the same as in 1986. Watch out for both regular tax and minimum tax. By use of a reserve or the five year block average you may be able to avoid minimum per- sonal tax. • fr47) Lucknow Central Public School welcomes New Registrations Monday, August 31 Tuesday, September 1 9 a.m. - .4 -p.m. Ever seen a house in a bag before? Now you have. This home in Lucknow is taking ad- vantage of the weather to have some work done on its exterior but in an effort to pro- tect its interior, the plastic had to be added. Could this replace aluminum siding all together? Enjoying a friendly game Congratulations to Martin and Nolda Hendriks on the occassion of their 35th wedding anniversary celebrated over the weekend. Mid -Week visitors with Jim and Margaret Errington were Doris and Ed Stienacker of Tavistock. It was nice to see them out enjoying a friendly game of euchre at the Seniors Centre this week. Ralph and Pat Hill of London were mid- week visitors with Bill and Marie Park and family. On the subject of the Park family, Brad Park has returned home following a nice 1 holiday in Kippen with his aunt and uncle, Robert and Marilyn Schultz and their family Terry, Tina and Lisa. There were 13 tables of euchre played at the Seniors Centre on Weddnesday even- ing. High lady of the day was Kathleen Glen while the low lady was Eva Adamson. High guy on the day was Micheal Foley while low man turned out to be Tom Culbert. I/A FOR BACK TO SCHOOL Sales Starts August 26 to August 29 Inclusive New Arrivals New Arrivals New Arrivals Jogging Suits Separates 20%OFF T -Shirts, Sweatersor Sweatshirts 20%OFF Cords and deans 20%0FF• Socks and Underwear 1 5 % OFF Summer Clothing 1It price School Supplies 1110/ O OFF Lucknow Variety & Dry Goods Lucknow 528-2238 VISA 1 MM.!