What's New for 2007 Tax Year

• Interest Rate: The interest rate for the 2008 calendar year remains at 7 percent. Click here for more information. You can also see previous year interest rates in Publication 58.
• Dual Income Tax System: The Utah individual tax law was changed for 2007 to allow you to calculate your Utah tax liability two ways and then pay the lesser tax. The TC-40 form was redesigned to permit you to calculate your tax under both methods.
  • The regular "traditional" tax is calculated from the same tax rate schedules used in 2006 and the tax is entered on line 12 of the Utah return. Click here to see the tax rate schedules.
  • The alternative "single rate tax" is then calculated on a "modified adjusted gross income" at 5.35%, and entered on line 13 of your Utah return.
  • The two calculations are then compared and you pay the lesser of the two taxes, which is entered on line 14.
• Utah Educational Savings Plan Deduction Expanded: The deduction for an investment in a Utah Educational Savings Plan has been increased for 2007. In addition, the allowable deduction on a return of a married couple filing jointly is the actual amount invested, but not more than twice the maximum allowed on a single return. See page 9 of the TC-40 instructions for more information.
• Utah Educational Savings Plan Credit: An investment in a Utah Educational Savings Plan may be taken as a deduction (Part 3 of TC-40S) under the traditional tax system. It may also be used as a credit under the single rate tax system when calculating the tax on line 13 of TC-40. See page 11 of the TC-40 instructions for more information.
• Nonrefundable Residential Energy System Tax Credit: The prior nonrefundable energy systems credit expired December 31, 2006, but a new credit is now available for a system installed on a residential unit that supplies all or part of the energy required. See page 13 of the TC-40 instructions for more information.
• Refundable Commercial Energy System Tax Credit: A new refundable credit is available for a commercial energy system. See page 15 of the TC-40 instructions for more information.
• Repealed Provisions:
  • The voluntary contribution to a College of Applied Technology Campus and the Uniform School Fund are no longer available.
  • The credit for hiring the disabled expired December 31, 2006.