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Congress recently passed, and the President signed, several bills collectively called the financial bailout package. Included in these bills was the Tax Extenders and Alternative Minimum Tax Relief Act of 2008.
The AMT patch increased the exemption amounts, for 2008 only, to levels slightly higher than those in effect for 2007 and will now be $69,950 for married joint returns, $46,200 for singles and $34,975 for married separate returns. Certain changes were also made to the provisions for the AMT refundable credit available to individuals with “long-term unused minimum tax credits.”
Previously expired tax provisions that are now extended through 2009 (i.e., available for 2008 and 2009 returns) include:
- Deduction of state and local general sales taxes (in lieu of income taxes)
- Qualified tuition deduction
- Teacher expense deduction ($250 “above the line” deduction)
- Additional standard deduction for real property taxes
- Direct IRA account “tax free” charitable contributions provisions
- Research & development credit (with some modifications)
- New markets tax credit
- Enhanced charitable deduction for food inventory
A number of disaster area relief provisions were passed, including declaring 11 counties in Michigan as disaster areas.
Numerous other credits and deductions were extended or created by this package of bills.
Contact your local Yeo & Yeo tax professional if you have questions or want to talk about strategies for minimizing your taxes for 2008 and beyond.
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