A Few New Tax Law Changes For 2009
January 21, 2009
We all remember the stimulus checks of 2008. Some of you may have received your full amount expected and some of you may not have. If you fall into the latter category there still may be hope for you yet to receive a stimulus check.
When you file your tax return this year you will need to know how much you received for your stimulus payment last year. This will NOT be taxable and you will NOT have to pay any of it back. Your preparer will need to know this number to check to see if you are eligible to receive a Rebate Recovery Credit. Basically, if you did not receive the entire stimulus check that you were supposed to or if your circumstances have now changed and you could have received a larger stimulus check in 08, you can claim that extra amount that you did not get last year on your 2008 return as a Rebate Recovery Credit. You also may be eligible to receive more than what you received last year if for instance you are claiming dependants on your return that you did not claim last year. This may happen in the case of a newborn child in 2008. In that case you will receive an extra $300 Rebate Recovery Credit added in to your federal refund this year! However, if your circumstances have not changed from 2007, then chances are you will not be able to claim this credit.
DEDUCT YOUR PROPERTY TAXES WITHOUT ITEMIZING!
Property taxes can now be deductible for those of us who do not itemize. Finally! Starting on this year’s tax return a married couple can deduct up to $1,000 of their property taxes without having to meet the limits of itemizing. A single person can deduct up to $500. Keep in mind that you can only deduct the amount of property taxes you paid in 2008 up to the above maximums. If for instance you are married and paid $873 in property taxes for 2008 then your deduction will be limited to $873.00. It may not be much but I will always take what the government offers, especially in our current economic climate.
NEW HOMEBUYER CREDIT!
If you have purchased a new principal residence between April 9, 2008 and July 1, 2009 you may be eligible for a nice surprise this tax season. You may claim a tax credit of up to 10% of the homes purchase price up to a maximum of $7,500! This is a completely refundable tax credit, which basically means that everyone, regardless of income, qualifies. But read the fine print! First of all you cannot have owned a home in the prior 3 years. Secondly, In 2 years, you must begin to pay back the credit you receive over equal installments over 15 years. For example if you purchased a home for $95,000 you can claim a New Homebuyer Credit in the amount of $7,500. This is actual money in your pocket. In 2010 you must start paying the credit back at a rate of $500 per year for the next 15 years. It’s still a great deal because any interest free loan is unheard of these days.
If you have any questions please feel free to give our office a call at 437-4646.