Although the new act contains the biggest tax cut in 16 years, it contains over 800 Internal Revenue Code amendments and almost 300 new provisions. What follows are some of the new or improved provisions for individuals. Sale of Principal Residence. The rolling-out can be done every two years. Gain may be triggered, however, to the extent the sale generates recapture of depreciation.
Depreciation occurs on a principal residence when part of it was used and deducted as a home office.
Generally, the new provisions are for sales occurring after May 6, 1997. The new code provides a tax credit for amounts paid for tuition or certain other education or related expenses. The complexity of the Hope Scholarship Credit, however, is bound to puzzle many soccer moms and dads. Both credits are available for qualified tuition and related expenses incurred for the taxpayer, the taxpayer's spouse, or the taxpayer's dependents. Both of these credits have income limitations.