I have done a quick review of the 18 page Senate Finance Committee summary of the various tax benefits tacked on to the bailout bill.
Here are the more important individual income tax changes and extensions:
Perhaps most important - for 2008 the dreaded AMT exemption amounts are increased to $46,200 for single and $69,950 for joint filers (up from the 2007 amounts), and personal credits will be allowed against AMT. Changes are also made to refundable AMT credit.
The following popular tax breaks have been extended through the end of 2009 –
* The option to deduct state and local sales tax instead of state and local income tax.
* The above-the-line “adjustment to income” for qualified tuition and fees.
* The above-the-line “adjustment to Income” for up to $250 in educator expenses.
* The additional Standard Deduction of $500 for single and $1,000 for joint filers for real estate taxes paid.
* The ability to make tax-free transfers directly from an IRA to a qualified charity.
The earnings threshold for the refundable Child Tax Credit for 2008 is lowered from $12,050 to $8.500.
In addition there are a multitude of special tax benefits related to those living or working in disaster areas.
I will provide a more detailed analysis of the tax provisions that affect 1040 (and 1040A) filers when I get a chance.
Here are the more important individual income tax changes and extensions:
Perhaps most important - for 2008 the dreaded AMT exemption amounts are increased to $46,200 for single and $69,950 for joint filers (up from the 2007 amounts), and personal credits will be allowed against AMT. Changes are also made to refundable AMT credit.
The following popular tax breaks have been extended through the end of 2009 –
* The option to deduct state and local sales tax instead of state and local income tax.
* The above-the-line “adjustment to income” for qualified tuition and fees.
* The above-the-line “adjustment to Income” for up to $250 in educator expenses.
* The additional Standard Deduction of $500 for single and $1,000 for joint filers for real estate taxes paid.
* The ability to make tax-free transfers directly from an IRA to a qualified charity.
The earnings threshold for the refundable Child Tax Credit for 2008 is lowered from $12,050 to $8.500.
In addition there are a multitude of special tax benefits related to those living or working in disaster areas.
I will provide a more detailed analysis of the tax provisions that affect 1040 (and 1040A) filers when I get a chance.
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