It's been said that the only two certainties in life are death and taxes. It's also been noted that the only difference between death and taxes is that death doesn't become more complicated and convoluted every time Congress meets.

We all know that almost every step you take during life has tax consequences, so here are a few major life changes that will significantly affect your tax return. Not to be morbid, but let's start with death.

The importance of estate planning
Most people don't realize that we have two systems of taxation. One taxes income as it's earned, the other taxes wealth as it changes hands. During lifetime, we call this transfer tax the gift tax. At death, we call it the estate tax, which carries significant tax consequences for you and your beneficiaries.

That's why estate planning is so important. Video: The looming estate tax

Each state has its own rules for state inheritance taxes. And then there's the federal estate tax.

For 2006 and 2007, there's no federal estate tax if your estate is worth $2 million or less. This "exclusion amount" increases until 2010, when it becomes unlimited for a year. That means no federal estate tax, regardless of how big an estate you leave.

I expect to see lots of dying rich people hooked up to machines at the end of 2009 to keep them alive until 2010.

But we're talking about the IRS here, so nothing is simple. Die on Dec. 31, 2010, and you pay zero estate tax, no matter how big your estate. Die the next day and the exclusion amount is scheduled to drop down to $1 million again. That's why it's so important to sit down with a professional if you think your estate might be big enough for the tax to hit.

The advantages of home ownership
One of life's first big steps with tax implications is the purchase of a first house. Once you own a home, you will probably itemize your deductions rather than take the standard deduction. Video chart: How and when to itemize

Your mortgage interest payments and property taxes will both be deductible. When you sell the house, you can exclude as much as $250,000 in gain ($500,000 on a joint return) if it was your principal residence for two of the last five years.

2 can be better than 1
Marriage will change your life for the better. Full disclosure: My wife, Barbara, insisted on that sentence.

Once you're married, you can no longer file taxes as single. Your marital status is determined on the last day of the year. So, if you marry on Dec. 31, the IRS considers you married all year. If you're divorced on Dec. 31, the IRS won't let you file jointly or as married filing separately.

There are BIG tax consequences here. Once you're married, you're subject to either a marriage bonus or a marriage penalty. You get a marriage bonus if only one of you works and earns a salary. That's because you can now file jointly, and the rates for joint filers are less than those for single filers. On the other hand, if both of you are working, there's a marriage penalty. Video: File jointly or separately?

The bright side of parenting
Now that you're married, you might as well bring some real bundles of joy into your life. (My kids made me include this one!) Ask any parent if having a child has consequences!

But let's look on the bright side. Each child gives you an additional exemption deduction of $3,300 for 2006 and $3,400 for 2007. Video: How to pay your kids and save

If they're under age 17, you're also offered a tax credit of as much as $1,000 per child. A tax credit is a dollar-for-dollar reduction in your tax -- much better than a deduction. (A note: You start to lose the credit once your income exceeds $110,000 for joint filers and $75,000 for singles.)

Of course, the real time to plan for kids is well before you have them, but better late than never. Once you have them, you must put aside money for their education. Consider a Section 529 account if you want to save for their college expenses on a tax-exempt basis. In my opinion, that's the best way to go. Video: Save taxes on college

Half of marriages end in divorce
You bought a house, married and had kids. Guess what's coming next (for some people)?

Half of all marriages end in divorce -- and if your marriage ends, there are lots of financial and tax considerations. Here are a few of them:

• Alimony and child support. Alimony is deductible for the paying spouse and is income for the spouse getting the dollars. Child support is neither deductible nor taxable.
• Equitable distribution of assets. This exercise has no immediate tax consequence. Whomever gets the property takes the old basis of that property . . . and pays any tax due when that property is sold.
• Insurance and retirement beneficiaries. Change your insurance and retirement beneficiaries where appropriate. If you're splitting retirement benefits, make sure you get a special court order called a Qualified Domestic Relations Order (QDRO), or you'll be taxed on dollars going to your former spouse. With a QDRO, the spouse receiving the money is the only one paying the tax.