Tax Law Changes and Updates for 2009

There are many tax law changes for 2009 that can save taxpayers hundreds to even thousands of dollars in taxes. Here is a list highlighting some of these changes:

A tax break on the purchase of a new car. This break allows taxpayers the ability to deduct the sales taxes they pay on a new car regardless of whether they itemize or not. The vehicle must be purchased between February 16, 2009 and December 31, 2009. Additionally, there is a phase-out for joint filers with incomes greater than $250,000 and single filers with incomes greater than $125,000.

A suspension of Required Minimum Distributions from retirement plans for 2009. This benefits retirees who are required to take distributions from their retirement accounts after reaching age 70½, but do not need to. By not taking distributions, it gives your retirement account a chance to grow after the downturn of the markets during 2008.

Bonus depreciation for equipment purchases. This benefit is extended for businesses that purchase equipment during 2009. An additional 50% of the purchase price can be expensed during the first year.

First-time homebuyer credit. First-time homebuyers may be eligible to receive a credit of up to $8,000 if they purchase a home before December 1, 2009. Prior year purchases between April 8, 2008 and December 31, 2008 may be eligible for a $7,500 credit.