Publication 553: 2002 Highlights of Tax Changes; Introduction

Publication 553

2002 Tax Year

Introduction

This is archived information that pertains only to the 2002 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.

Introduction

This publication highlights tax law changes that take effect in 2002, 2003, and later years. The chapters are divided into separate sections based on when the changes take effect.

Changes covered in this publication include the following.

Tax benefits for education, including the new tuition and fees deduction and educator expenses deduction.
Pension changes such as higher contribution and benefit limits for retirement plans, the tax credit for certain pension plan startup costs, an increased SEP contribution limit, catch-up contributions, and deemed individual retirement arrangements (IRAs).
An increase in the allowable amount of IRA contributions.
Extension of the welfare-to-work credit and work opportunity credit.
Free Internet filing options.
How you report interest and dividends.

See the discussion of each topic for more information.

Adjusting your withholding or estimated tax payments for 2003. If your tax for 2003 will be more or less than your 2002 tax, you may need to adjust your withholding or estimated tax payments accordingly. If your tax will decrease, you can get the benefit of lower taxes throughout the year. If you will owe more tax, you can avoid a penalty when you file your tax return.

See the following table for forms and publications that will help you adjust your withholding or estimated tax payments. See chapter 8 for information on ordering forms and publications.


To adjust your   Get Form        And Publication
------------------|-------------------|-------------
 Withholding      |W-4, Employee’s    |919, How Do I
                  |Withholding        |Adjust My Tax
                  |Allowance          |Withholding?
                  |Certificate        |
------------------|-------------------|-------------
 Estimated tax    |1040-ES,           |505, Tax
 payments         |Estimated Tax      |Withholding &
                  |for Individuals    |Estimated Tax

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

Comments and suggestions. We welcome your comments about this publication and your suggestions for future editions.

You can e-mail us while visiting our web site at www.irs.gov.

You can write to us at the following address:

Internal Revenue Service
Tax Forms & Publications
W:CAR:MP:FP
1111 Constitution Ave. NW
Washington, DC 20224

We respond to many letters by telephone. Therefore, it would be helpful if you would include your daytime phone number, including the area code, in your correspondence.

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