|
Important 2009
Tax Provisions
1) American Opportunity Tax Credit
--Maximum credit increased to $2,500 (100% of first
$2,000 expenses, 25% of next $2,000 expenses)
--Applies to the first four years of post-secondary
education
--40% refundable unless claimed by a child subject to
kiddie tax
--Phases out at $80,000-$90,000 MAGI ($160,000-$180,000
MFJ)
--Students in Midwest Disaster Area may instead claim an
enhanced Hope credit of up to $3,600 for 2009
2) AMT
--AMT exemption increased to $46,700 ($70,950 MFJ)
--Nonrefundable personal credits allowed for AMT
3) Bicycle commuting fringe benefit 2009 and later
years
--Qualified tax-exempt transportation fringe benefit;
NOT a tax credit
--Up to $20/month (maximum $240/year) to reimburse
employees who regularly commute to work via bicycle
4) Casualty losses Change for 2009 only
--The $100 per casualty floor for individual casualty
losses is temporarily raised to $500 per
casualty
5) Child Tax Credit
--Additional Child Tax Credit (ACTC) earned income
threshold decreased to $3,000 (was $8,500
in 2008)
6) COBRA subsidy Beginning with COBRA premiums
paid after 2/16/09)
--COBRA premiums are 65% subsidized for up to 15 months
--Jobless taxpayers who were involuntarily terminated
9/1/08 through 2/28/10
--Recaptured dollar-for-dollar for taxpayers with MAGI
over $125,000 ($250,000 MFJ)
7) Conversion kits
--Nonrefundable credit equal to 10% of the cost of
converting to a plug-in electric drive motor
vehicle
--Maximum credit is $4,000
--May be claimed for a vehicle that also qualifies for
the hybrid vehicle credit
8) Depreciation
--50% bonus depreciation extended through 2009
--Enhanced §179 deduction up to $250,000 extended
through 2009
--Qualified farm machinery eligible for 5-year MACRS
depreciation
--Generally, any original use machinery used in farming
business other than grain bin, cotton
ginning asset, or other land improvements
9) Economic Recovery Payment (ERP)
--One-time payment of $250 for recipients of SS, SSI,
VA, or RRB benefits paid directly by the
SSA, VA or RRB
--Must have received a benefit 11/2008, 12/2008, or
1/2009
--Reduces the Making Work Pay Credit
--IRS will not provide verification regarding whether a
taxpayer received the ERP but will reject
return if ERP is missing
10) Earned Income Credit modifications
--Higher EITC for families with three or more children
--Additional marriage penalty relief (phaseout threshold
for MFJ increased an additional $5,000
over the range for unmarried filers)
11) First-Time Homebuyer Credit
--Refundable credit equal to 10% of home purchase
-- Maximum credit
$8,000 ($4,000 MFS) for taxpayers who did not own
principal residence in previous 3 years
$6,500 ($3,250 MFS) for long-term homeowners who owned
and lived in their principal residence
5 consecutive years out of 8 and who purchase a
replacement home after 11/6/09
Butler Tax and Accounting
5959 S Redwood
Road, Salt Lake City, UT 84123
Phone: 801-268-2245 Fax: 801-268-2291
E-mail Us |
|
