Tracy, CA--(Business Wire)--December 14, 2005-- For survivors of this year's nightmarish hurricane season, Katrina continues to wreak havoc with taxpayers both large and small -- even anyone who helped with relief efforts and wants to claim appropriate deductions.

"The IRS has already issued at least 19 forms allowing taxpayers to deduct a variety of expenses from gasoline and transportation to those incurred in housing survivors and providing clothes, food and medicine," said Eric Hayes, Senior Tax Analyst, Taxbrain.com (http://www.taxbrain.com, the do-it-yourself consumer brand of Petz Enterprises, Inc.

"Meanwhile, Congress is considering major changes to the tax code, some of which will be enacted before the April 15, 2006 deadline. For taxpayers preparing their returns and filing on line, these changes can be taken in stride. For those preferring to do their return on the kitchen table with pencil and paper, this coming season could be as bad as the hurricane itself!"

PROFESSIONAL TAX PREPARER UTILIZES ONLINE TOOLS
TO BETTER SERVE CLIENTS

Ralph Lloyd, CEO of Jackson, MS based EZ-Tax Online (http://www.ez-taxonline.com) explained, "For our tax clients, this year poses a great challenge in first knowing if they qualify for any special relief due to Hurricane Katrina and secondly finding out exactly how to file for this relief. We have used online tax preparation for 4 years and this method should be very helpful in helping our clients achieve their goal of a larger refund.

"Petz Enterprises online software is in a user friendly format and will have an easy to read questionnaire concerning Hurricane Katrina," Mr. Lloyd added. "It will direct the taxpayer to the proper form for taking these deductions as well as helping them understand what deductions they can or cannot take. Taxpayers who choose to use online filing will be assisted in completing the tax return properly, swiftly and accurately insuring they will maximize their refund and receive it much faster than any other way," he said.

HOT AREAS UNDER CONSIDERATION BY CONGRESS
DUE TO GULF COAST DESTRUCTION

Bonus Depreciation. Current law allows businesses to recover the costs of new equipment over the economic life of the property. The bonus depreciation proposal would permit businesses to expense 50 percent of the cost of new equipment placed in service in the Gulf Opportunity Zone in the first year. Property which qualified for bonus depreciation would include certain commercial and residential rental real estate expenditures as well as equipment. Investments would not be subject to the AMT depreciation preference. This provision would apply to property placed in service in the Gulf Opportunity Zone through 2007 (2008 for real property).

Increase in Expensing for Small Businesses. Current law permits certain small businesses to deduct up to $100,000 of the cost of property used in the business. The proposal would double this amount to $200,000 for qualifying expenditures made in the disaster area through 2007. This provision would also increase the level of investment at which benefits phase out from $400,000 to $1 million of qualifying purchases, thus allowing more businesses to use this tax benefit in rebuilding.

Small Business Expensing. The 2003 tax act increased the amount that small businesses may expense from $25,000 to $100,000 for three years (through the end of 2005). The American Jobs Creation Act of 2004 (the "JOBS" Act) extended a slightly expanded version of small business expensing (with higher phase-out levels for small business) through 2007. The provision would extend that enhanced provision through the end of 2009.

Hope Scholarship and Lifetime Learning Credit. Current law allows a Hope Scholarship Credit in first two years of postsecondary school equal to100% of the first $1000 of qualified tuition and related expenses, and 50% of the next $1,000 for a maximum of $1,500. There is also a Lifetime Learning Credit available to students enrolled in one or more courses at the undergraduate or graduate level (whether or not pursuing a degree), equal to 20% of the first $10,000 in qualified tuition and related expenses. The credits phase out between $42,000 and $52,000 (single filers) and $85,000 and $105,000 (married filing jointly) for 2004 (adjusted for inflation thereafter). For each year, though, taxpayers may only claim the Hope, Lifetime, or Qualified Tuition Deduction with respect to an eligible student. The provision doubles the Hope Credit dollar amounts so the maximum credit would be $3,000, and doubles the Lifetime Learning Credit percentage from 20% to 40%, for a maximum Lifetime Learning Credit of $4,000. Room and board, books and fees would also be considered qualified expenses.

Non-Itemizer/Itemizer Deduction. The bill provides for a charitable deduction for cash donations made by taxpayers who do not itemize their deductions (approximately 74 percent of filers currently cannot take a charitable deduction because they do not itemize). The bill creates a floor of $210 for single filers ($420 for joint filers) that applies to both taxpayers who do not itemize and those that do. The new deduction is not subject to an income cap. The proposal requires donors to obtain a receipt, cancelled check or letter or other written acknowledgement for all cash contributions. The provision is estimated to cost $2 million over five years.

For the sixth consecutive year, TaxBrain.com, will be up and running as of January 1, 2006, again making it the first online service to be available to taxpayers across the country.

About TaxBrain.com® Online Tax & E-file Service

TaxBrain.com is the only web-based tax solution delivering online preparation, filing, professional assistance and representation in all 50 states. TaxBrain.com is a full-service online tax center providing tax advice, tools, and resources all year to help taxpayers manage their tax burden with greater confidence and ease. For more information visit www.taxbrain.com/press.

About Petz Enterprises, Inc.

Petz Enterprises, Inc. (a closely-held California corporation) is a software development company and a leading provider of tax preparation and filing solutions for the professional and consumer markets, helping to automate and simplify federal, state and local tax compliance. PEI's Crosslink® line of professional tax software products enable tax practitioners and service bureaus to accurately prepare and file large volumes of individual tax returns. Founded in 1974, Tracy, CA-based PEI is dedicated to serving the needs of the professional tax community and individual taxpayers worldwide. For more information, visit http://www.petzent.com.