Wang & Associates

Certified Public Accountants (CPAs)

Neng-Hsiang Wang, CPA

Ming J. Lee, CPA

606 Seventh Street, S.W.

Washington, DC 20024-2402

Phone (202) 479-0744 & 554-4314

Fax (202) 479-4218

December 12, 2003

Re: Introducing 2003 Tax Laws 介紹二 00 三年美國稅法

Dear Friend 敬愛的朋友 :

I am Neng-Hsiang Wang, CPA. From the bottom of my heart, I wish to thank you for allowing me opportunities to serve you in the past year; I wish you to accept my Christmas greetings. May the love, joy, and peace of Christmas be upon and with you!

我是王能祥會計師。首先，從內心的深處，我感謝您過去一年的惠顧，也祝福您聖誕快樂。 願您充滿聖誕的慈愛、溫馨、跟平安。

We live in a land of melting pot , witnessing daily opportunity, abundance, and freedom. Here , our government of the people, by the people, and for the people-- American Democracy --protects us with a system of good domestic security and powerful national defense. Our transportation system is second to none. Our legal system tries its best to offer equal opportunity and equal protection. We have the right to speak out and the right to keep silent. These are the rights and privileges we enjoy as citizens of the United States.

我們都生活在一個民族大熔爐的國度裡 — 處處充滿機會、富裕、和自由。每天，在這土地上，一個奠基於民有、民治、民享—俗稱 民主政治 — 的政府，用優良的國內治安制度和強盛的國防保護我們。美國的交通系統舉世無雙。在法律之下人人平等。我們有說話與不說話的自由。這一切是美國公民所擁有的權利和特權。

We should not take it for granted. There is no such thing as a FREE LUNCH . We have to pay prices. We have to pay taxes to have all these good things happen.

可是，我們不可視它為理所當然。美國沒有 白吃的午餐 。我們要付出。我們要納稅，用納稅的方式支持政府提供給我們良好的生活環境和公平創業就業機會。

Although our tax system is not perfect, members of United States Congress have been working hard to ensure that “ equity ”, whatever meaning it may be, is of the top of their conscience and consideration. As the political clock swings back and forth, the definition of “ equity ” fluctuates, resulting in constant revision of tax laws.

儘管美國的稅制不是盡善盡美，國會山莊的大人們都把 「 公平公正 」 掛在 心裡 ，憑藉良心立稅法。政治的時鐘不斷搖擺，所謂 「 公平公正 」 的定義也隨之改變。這就導致國家稅法年年修改。

This year, the changes in the Federal tax laws that affect most people, in my opinion, fall into the following ten categories:

依我的觀察，今年的美國聯邦稅法有十大項的修改。茲舉其大者，介紹於下 :

Schedule of 2003 Major Tax Changes 二 00 三年美國聯邦稅法十大修改一覽表

• I. 標準扣除額 (Standard Deduction) 2004 2003 2002 基準 (Base)

單身 (Single) 4,850 (103%) 4,750 (101%) 4,700 (100%)

結婚合報 (Married filing Jointly) 9,750 (124%) 9,500 (121%) 7,850 (100%)

結婚分報 (Married filing Separately) 4,850 (124%) 4,750 (121%) 3,925 (100%)

戶主 (Head of Household) 7,150 (103%) 7,000 (102%) 6,900 (100%)

• II. 個人免稅額 (Personal Exemption) 2004 2003 2002 基準 (Base)

3,100 (103%) 3,050 (102%) 3,000 (100%)

• III. 所得稅累進稅率 (Tax Rates) 2004 2003 2002

Income less Than Income Less Than Income Less Than

(1) 最低所得稅率 (Lowest Tax Rate: 15%) 收入少於 收入未滿 收入未滿

單身納稅人 Single 7,151 7,001 6,001

結婚合報 Married, Joint 14,001 14,001 12,001

結婚分報 Married, Separate 7,151 7,001 6,001

•  次低所得稅率 (Second Lowest Tax Rate: 25% or 27%)

單身納稅人 Single ? 29,050 (25%) ? 28,400(25%) ? 27,950(27%)

結婚合報 Married, Joint ? 58,100 (25%) ? 56,800(25%) ? 46,700(27%)

結婚分報 Married, Separate ? 29,050 (25%) ? 23,725(25%) ? 23,350(27%)

•  再次低所得稅率 (Third Lowest Tax Rate: 28% or 30%)

單身納稅人 Single ? 70,350 (28%) ? 68,800(28%) ? 67,700(30%)

結婚合報 Married, Joint ? 117,250 (28%) ? 114,650(28%) ? 112,850(30%)

結婚分報 Married, Separate ? 68,625 (28%) ? 57,325(28%) ? 56,425(30%)

•  再再次低所得稅率 (Fourth Lowest Tax Rate: 33% or 35%)

單身納稅人 Single ? 146,750 (33%) ? 143,500(33%) ? 112,850(35%)

結婚合報 Married, Joint ? 178,650 (33%) ? 174,700(33%) ? 171,950(35%)

結婚分報 Married, Separate ? 89,325 (33%) ? 87,350(33%) ? 85,975(35%)

•  最高所得稅率 (Highest Tax Rate: 35 or 38.6%)

單身或結婚合報 Single & Married, Joint ? 319,100 (35%) ? 311,950(35%) ? 141,250(38.6%)

結婚分報 Married, Separate ? 159,550 (35%) ? 159,975(35%) ? 153,525(38.6%)

• IV. 投資利得稅率 (Capital Gain)

(1) 長期投資達一年以上者 (Long-Term Capital Gain)

2004 2003 2002

Sold before 5/5/2003 以前出售者 ---- 20% 20%

Sold after 5/5/2003 以後出售者 15% 15% ----

(2) 短期投資不達一年者 , 依普通所得稅累進稅率計算。 (Short-Term treated as Ordinary Income.)

• V. 勞動所得補助額 (Earned Income Credit)

2004 2003 2002

未育小孩最高補助額 (No children) 390 382 376

育有一個小孩最高補助額 (One child) 2,604 2,547 2,506

育有兩個以上小孩最高補助額 (Two children) 4,300 4,204 4,140

• VI. 未滿十七歲小孩特別補助額 (Child Credit) 2004 2003 2002

每一小孩補助 Each child 1,000 1,000 600

• VII. 成人教育補助金 (Adult Education Credit) 2004 2003 2002 HOPE Credit per student( 每一學生最高補助 ) 1,500 1,500 1,500

Lifetime Learning Credit per tax return 2,000 2,000 1,000

( 每一稅表最高補助 )

•  個體戶及 S Corporation 設置的公司購買健康保險費 , 得以商業費用沖帳 :

Deductibility of Health Insurance Premium for business under Sole Proprietorship and S Corporation

2004 2003 2002

100% 100% 70%

IX. 全年工資不足 $1,400 者，得免繳社會安全稅。 If wages below $1,400, no FICA tax required.

X. 遺產稅以及贈與稅稅率例示 (Selected Years of Estate Tax Rate and Gift Tax Rate):

Year 遺 產 稅 ( Estate Tax ) 贈 與 稅 ( Gift Tax )

年度 免稅額 (Exemption) 最高稅率 (Max. Tax Rate) 免稅額 (Exemption) 最高稅率 (Max. Tax Rate)

2003 1,000,000 49% 1,000,000 49%

2004 1,500,000 48% 1,000,000 48%

2005 1,500,000 47% 1,000,000 47%

2006 2,000,000 46% 1,000,000 46%

2010 全 免 (Repealed) 全免 (Repealed) 1,000,000 35%

2011 1,000,000 55% 1,000,000 55%

ANALYSIS OF 2003 MAJOR TAX CHANGES 今年主要稅改分析

Let me analyze the schedule above. First of all, we witness from Section (I) an equalization of Standard Deduction for MARRIED taxpayers to make it the same amount as SINGLE taxpayer. This is to close the gap of the so-called “marriage penalty” often criticized under the old income tax system.

現在我來分析上表。首先，從 (I) 節看到，就標準扣除額一項，從今年起，結婚納稅人和單身納稅人已經沒有區別。過去所謂歧視結婚者，已不存在。

Second, as shown in (II), the change of Personal Exemption is very minimal, up from 3,000 to 3,050.

第二，如 (II) 節所示，個人免稅額所調整幅度極有限 : 由 3,000 調到 3,050 。

Third, from (III), we can see that the “equity-based” graduated Federal income tax system, compared to last year's, has become less graduated. For instance, the second lowest tax rate is now 25% as opposed to 27% last year. And the highest tax rate is now 35% as opposed to 38.6%.

第三，如 (III) 節所示，過去用累進方式以促進「公平公正」的聯邦所得稅制，今年累進幅度明顯地變小。例如 : 今年次低所得稅率降到 25% ，這比去年的 27% ，降低 2% 。 再說，今年最高所得稅率是 35% ，而去年是 38.6% 。

Fourth, Long-Term Capital Gain Tax, as shown in (IV), is lowered this year from 20% to 15%, if the security was sold after May 5, 2003. This is a great incentive to investors who are willing to keep their securities longer than one year.

第四，如 (IV) 節所示，長期投資達一年以上者，有福了，蓋你今年若五月五日以後才出售有價證券的話，你的投資利得稅，將不再是 20% ，而是 15% 。

Fifth, as indicated in (V), the adjustment of Earned Income Credit is minimal. In other words, the voice of poor laborers was not heard by the lawmakers in US Congress.

第五，如 (V) 節所示，勞動所得補助額調整幅度極有限。換言之，今年低收入勞動者發出的聲音顯然不夠大，以致於國會山莊的大人們沒聽進耳朵裡。

Sixth, as indicated in (VI), a typical family which rears children, all of whom are less than 17 years old, will receive special child credit of $1,000 per child, up from $600 last year. What a great increase!

第六，如 (VI) 節記載，家裡有未滿十七歲小孩者，每一小孩可得千元補助，這個數目和去年的六百元相比，增加的額度非常可觀。

Seventh, as stated in (VII), Lifetime Learning Credit, which is an incentive to motivate adult Americans to continue their education after receiving two years of college education and even after leaving schools, is made much more attractive this year. Last year, the maximum credit is only $1,000; this year, the amount is double.

第七，如 (VII) 節記載， Lifetime Learning Credit ( 終生學習獎勵 金 ) ，這個為鼓勵公民活到老、學到老給予獎勵，今年由每一稅表補助一千元，提高為兩千元。

Eighth, I want to introduce two major incentives for the people who do business as Sole Proprietorship or as S Corporation. For years, there had been a double standard in the deductibility of health insurance premium between doing business as Sole Proprietorship/S Corporation and as C Corporation. Whereas C Corporation has been allowed 100% deductibility of such premium, Sole Proprietorship/S Corporation has not. The gap has been made closer and closer. Effective this year, such premium is allowed full deduction for doing business as Sole Proprietorship or S Corporation.

第八，至此，即由 (I) 節到 (VII) 節，我都介紹有關個人納稅須知。此節和下節起，我將轉舵來進行討論企業組織的所得稅法。多年來，在美國用個体戶獨資 (Sole Proprietorship) 經營，或用小生意公司型態 (S Corporation) 經營者，所支付的健康保險費，僅許可部分沖帳。可是，若以股份有限公司型態 (C Corporation) 組織者，一向得全額沖帳，其不公平不公正，莫此為甚。此種不公，近年來一直努力縮短。自今年起，這種差別待遇，已經全部取消。

Ninth, in the old days, all wage earners must pay FICA taxes (i.e., social security tax and Medicare tax). Effective this year, such taxes are exempt if the wages earned are less than $1,400 a year.

第九，如 (IX) 節記載，低收入者其由勞動而獲的所得全年未滿 $1,400 者，政府今年開了方便之門。打從今年起，工作收入未達 $1,400 者，納稅人得免報 FICA taxes-- 即免除申報、免除繳納社會安全稅和醫療保險金。

Tenth, in the previous years, the maximum exemption of estate tax AND GIFT TAX COMBINED had remained to be $600,000. This year, it is $1,000,000. Next year, it will jump to $1,500,000. The following year, it will further jump to $2,000,000. And the greatest news for senior citizens is that in the year of 2010, the system of estate taxation will be repealed for at least one full year. What about the year of 2011? Just be patient; wait and see. For details, kindly refer to (X) above.

第十，過去一段很長的歲月裡，一個富人的遺產和贈與兩項目合起來，其免稅額一直維持在 $600,000 。今年免稅額升到 $1,000,000 。明年其免稅額再升高到 $1,500,000 。後年又高到 $2,000,000 。而最有趣的是 2010 年 。 那一年，遺產稅制將完全停止實施，即不課徵之意。 欲知其詳，請參考上面 (X) 節。

CONCLUSION 本文結論

The tax issues in the real world are actually more complicated than presented above. Yet, I hope that I have made the major tax changes a little clearer to you. Should you need to know more, please visit me at my accounting firm, Wang & Associates .

在現實的層面，稅法比上述複雜得多。欲知應用，請撥冗本會計師事務所。 本會計師事務所位於 606 7 th St., S.W. Washington, DC 20024. 電話 : (202)554-4314.

WISHING YOU A HAPPY NEW YEAR ! 恭喜新年好運、恭喜發大財 !

From Neng-Hsiang Wang CPA 王能祥會計師 鞠躬 於美國 華府