Tax Law Changes for 2009 That May Affect Your Taxes

Tax Law Changes for 2009 That May Affect Your Taxes:

1. First-time Homebuyer Credit:
   The credit increased to as much as $8,000 ($4,000 if married filing separately) for homes bought after 2008 and before May 1, 2010.
2. Homebuyer Credit for Current Homeowners:
   A refundable credit of up to $6,500 (up to $3,250 for married filing separate) for long-time homeowners buying a replacement principal residence between Nov. 7, 2009 and April 30, 2010, and close on the home by June 30, 2010.
3. American Opportunity Credit:
   The modified Hope education credit has increased to $2,500, and if you qualify, is refundable.
4. Earned Income Credit (EIC):
   The EIC has increased for people with three or more children and for some married couples filing jointly. The thresholds for Modified Adjusted Gross Income have increased.
5. Alternative Minimum Tax (AMT):
   The AMT exemption amount has increased to $46,700 ($70,950 if married filing jointly or a qualifying widow(er); $35,475 if married filing separately).
6. Standard Deduction:
   The standard deduction for taxpayers who do not itemize deductions on Schedule A has increased. The amount depends on your filing status.
7. Qualified Motor Vehicle Tax Deduction:
   If you bought a qualified new motor vehicle in 2009 after February 16, you may be able to deduct any state or local sales or excise taxes on the purchase.
8. Standard mileage rates:
   For 2009, the standard mileage rate for the cost of operating your car for business use is 55 cents per mile. For medical reasons or moving expenses, the rate is 24 cents per mile.
9. Credit for nonbusiness energy property:
   You may be able to take this credit for qualifying energy-saving home improvements made in 2009.
10. Government Retiree Credit:
    You may be eligible for this refundable credit if you receive a government pension or annuity, but it reduces any Making Work Pay Credit amount.