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PRICE WATERHOUSE PERSONAL TAX ADVISER OUTLINES LAST MINUTE TAX TIPS

 PRICE WATERHOUSE PERSONAL TAX ADVISER OUTLINES LAST MINUTE TAX TIPS
 NEW YORK, April 8 /PRNewswire/ -- End-of-season tax filers can still take advantage of some last minute tax strategies. Even as April 15 fast approaches, taxpayers have a last chance to reduce their 1991 tax liability, postpone filing their 1991 returns by obtaining a "no question asked" filing extension if necessary, and minimize the amount of 1992 estimated tax, due on April 15, 1992. Some of these topics are outlined in the "Price Waterhouse Personal Tax Adviser."
 IRA's
 Joint filers with adjusted gross incomes (AGI) of $40,000 or less can make fully deductible IRA contributions even if one or both are covered by an employer-provided qualified retirement plan. When AGI falls between $40,000 and $50,000 and either or both spouses are covered by an employer-provided retirement plan, the deductibility is phased out so that couples with AGIs of $50,000 or more cannot deduct their IRA contribution.
 If you and your spouse both are not eligible for an employer- provided retirement plan, there is no income limit on the deductibility of IRA contributions.
 The maximum IRA contribution is the lesser of earned income or $2,000 (or $2,250 if you file jointly and your spouse does not work outside the home or earns less than $250 a year). If you are not eligible to make a tax deductible IRA contribution, you can make a nondeductible contribution and enjoy tax-deferred earnings.
 The deadline for making an IRA contribution for 1991 is April 15, 1992.
 Extending returns
 You can get an automatic four-month extension, no questions asked, to file your 1991 Form 1040 until Aug. 17, 1992 (Aug. 15 is a Saturday this year) by completing Form 4868 and filing it by April 15, 1992. To avoid penalties, however, you need to pay at least 90 percent of the tax due in 1991 on April 15, 1992 when you file Form 4868. Interest will always accrue on the balance of tax due.
 If you need more time, you can ask for more months until Oct. 15, 1992 by filing another form, Form 2688, with the IRS no later than Aug. 17. Or you can write a letter to IRS by the same date. In both cases, you must specify the reason for the extra time, the tax year involved, how much extra time is needed and whether you already received an extension. This extension is not automatic -- the IRS can deny it. If denied you will receive a letter that will give a 10-day grace period (from the date on the IRS letter or Aug. 17, whichever is later) in which to file your return.
 Extensions of time to file your federal tax return may not automatically extend your time to file your state and local tax returns. So check with your state and local tax authorities regarding extensions.
 Last year, the IRS initially announced that it would begin a program of paperless extensions to begin in 1992 (affecting 1991 returns and extensions). However, the IRS delayed the program indefinitely because of too many unanswered questions regarding how this program would proceed.
 People who live (or are on military assignment) outside the U.S. or Puerto Rico on April 15, 1992, have an automatic two-month extension until June 15, 1992 to file their 1991 returns. There is no need to file Form 4868 -- only attach a note to the top of the 1991 Form 1040 when it is filed by June 15. You have until June 15 to pay your taxes, but you will be charged interest on the amount due from April 15 on.
 Looking ahead to 1992:
 Estimated Taxes
 Beginning with 1992, certain taxpayers may no longer escape a penalty for underpaying estimated taxes by basing estimated tax payments and withholding on 100 percent of the prior year's taxes (in tax jargon, the 100 percent safe harbor). Instead, 1992 estimated tax payments must be based on 90 percent of the tax owed in 1992.
 Generally, to be subject to this new rule:
 -- AGI for joint filers must exceed $75,000; and
 -- AGI must exceed last year's AGI by $40,000; and,
 -- Taxpayers must have made estimated tax payments in 1989, 1990 or 1991 or must have been charged an estimated tax penalty for any of those years. (Even if you meet the first two requirements, if you don't satisfy this last requirement, you are not subject to the new rule.)
 However, for only the first 1992 estimated tax installment due April 15, 1992, you can still use the 100 percent safe harbor, but you must make up any shortage in the next succeeding required installment.
 The penalty on underpayment of 1992 estimated taxes will be waived only on the portion of the underpayment due to the changes in the withholding tables that President Bush provided earlier this year. (Note: A waiver also must be obtained if "reasonable cause" exists.)
 The "Price Waterhouse Personal Tax Adviser" is part of the firm's three-volume Adviser Series. Other books in the series include "The Price Waterhouse Retirement Planning Adviser" and "The Price Waterhouse Investor's Tax Adviser." The series contains information to help readers enhance their own financial pictures and provides readers the information needed in these economic times when every dollar counts. Published by Pocket books, a division of Simon & Schuster, the books are available for $5.99 each in bookstores nationwide.
 -0- 4/8/92
 /CONTACT: Judy McMillan of Price Waterhouse, 212-790-4715/ CO: Price Waterhouse ST: New York IN: FIN SU:


AH-KW -- NY064 -- 6294 04/08/92 13:16 EDT
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