Just in time before the start of the 2008 filing season, Congress passed an AMT patch, which preserves an exclusion that will keep almost 25 million middle-income taxpayers out of the reach of the AMT retroactively for one more year -- 2007. It also passed mortgage tax relief, an energy bill with several tax provisions, special tax breaks for victims of the Virginia Tech tragedy, increased funding for the IRS, and an important technical corrections bill to end the year.

Congress, however, failed to pass a package of extenders for certain tax breaks to carry over into 2008. It may do so retroactively to January 1, 2008, sometime during the first half of the new year. A farm bill, with farm-related tax incentives, also stalled at the last minute as did tax relief for America's military personnel. And a long-list of revenue raising provisions that threaten tax increases for certain taxpayers await being considered when Congress reconvenes in mid-January.

Here a run down of the major tax laws that were passed and became law in December:

The AMT Patch. On December 19, the House passed and sent to the President the Tax Increase Prevention Act of 2007. The legislation increases AMT exemption amounts for 2007 to $44,350 for single taxpayers and $66,250 for joint filers. The legislation also extends through 2007 the provision allowing most nonrefundable tax credits for AMT purposes.

Mortgage Debt Relief. On December 18, the House passed by unanimous consent the Senate version of the Mortgage Forgiveness Debt Relief Act of 2007. The legislation includes a three-year mortgage debt forgiveness exclusion of up to $2 million in debt on a principal residence, retroactive to January 1, 2007. The legislation also extends the mortgage insurance premium deduction for three years, includes an exclusion for benefits to volunteer fire-fighters and emergency medical responders, extends the joint return sale of principal residence exclusion to certain post-marriage sales by surviving spouses, clarifies student housing eligible for the low-income housing credit, and provides alternative tests for qualifying as a cooperative housing corporation.

The Energy Act. On December 18, the House passed and sent to the President, by a vote of 314 to 100, the Energy Independence and Security Act of 2007, as passed by the Senate without the tax title. Included in the legislation are two Tax Code provisions relating to the extension of the additional 0.2 percent FUTA surtax and seven-year amortization of geological and geophysical expenditures for certain major integrated oil companies.

IRS Funding.  On December 19, Congress also passed the Consolidated Appropriations Act 2008, after a month of wrangling. It gives the IRS more money for enforcement efforts. $10.9 billion is allocated for the IRS, a $300 million increase over the FY 2007 IRS budget. The IRS budget includes $4.8 billion for enforcement activities, $2.2 billion for taxpayer services, and $3.7 billion for operations support for enforcement, taxpayer service, and other IRS functions. It also contains $267 million for business systems modernization and $177 million for the Taxpayer Advocate Service.