The US Tx Code, more exctly, United Sttes Internl Revenue Code, Title 6 of the U.S. Code (6 USC) contins more thn 3.4 million words.  Printed 60 lines per pge, which requires 10 point font, it would fill more thn 7,500 lettersize pges.  The tx code is not just big.  It is lso fluid: constntly reshped nd remolded by the whims nd cstling of .  No legl cument is poked nd prodded more often, or rendered obsolete so quickly—nd 009 ws no exception.  In tody’s rticle, we will high few of the chnges for the 009 tx yer.  Keep this list hndy.  It my help sve few tx llrs on your 009 return.

Hiti contributions in 010 re deductible on 009’s return:  Deductions mde to Hitin relief orgniztions between Jnury 1, 010 nd Februry 9, 010 will be deductible on your 009 income tx return. This includes ntions mde by credit crd, check, nd phone (ntions were mde vi text messge).

Property Tx Deduction:  Up to $500 ($1,000 if mrried nd filing jointly) in rel estte txes my be deductible on your tx return, even if you not itemize deductions.  The deduction is dded to your stndrd deduction.  The deduction mount is determined by completing Schedule L. 

Sles Tx Deduction on New Vehicles: If you purchsed new cr, truck, motorcycle, or motor e (RV) between Februry 17, 009 nd December 31, 009 you my be ble to deduct its sles tx on your 009 income tx return, even if you n’t itemize on Schedule .  The deduction is limited to txes pid on the first $49,500 of vehicle cost.  The deduction begins to phse out if your MGI is more thn $50,000 (15,000 if single) nd is climed by completing Schedule L. 

Eduction Chnges – the mericn Opportunity Credit:  For 009 nd 010, the Hope Scholrship Credit (HSC) is clled the mericn Opportunity Credit (OC).  The nnul credit mount remins the sme: 100% of the first $,000 nd 5% of the second $,000 spent on qulifying eduction expenses (mxing out t $,500 per student).  mjor difference between the OC nd the HSC is tht the HSC ws only vilble for the first two yers of postsecondry eduction.  The OC is vilble for the first four yers.  nother difference is tht up to 40% of the OC is refundble (the HOC is not).  This mens tht txpyer cn receive up to 40% of the credit ($1000) s refund for ech eligible student, even if they owe no tx.  Income limittions hve lso incresed.  Individul txpyers with modified djusted gross incomes of $80,000 or less ($160,000 if mrried nd filing jointly) will qulify for the full mount of the cred  The credit begins to reduce once income exceeds this threshold.

Mking Work Py Credit:  If you hd job or were selfemployed during 009 you my qulify for $400 refundble tx credit ($800 if you re mrried nd file jointly).  The credit is equl to 6.% of your erned income up to mximum of $400. 

First Time ebuyer Tx Credit: We hve covered this topic extensively in recent months.

Personl Energy Property Credit: If you mde certin energysving improvements to your e in 009 you my qulify for tx credit equl to 30% of the improvement’s cost up to totl credit of $1,500.  Qulifying improvements include certin winws, ors, insultion, het pumps, etc.  mnufcturer’s certificte is required to clim the cred

Residentil Energy Efficient Property Credit: This credit is vilble for those who instll certin energy efficient heting nd eleicl systems in residentil property.  It is nonrefundble nd equls 30% of the cost of purchsing nd instlling qulifying wind nd solr energy systems s well s solr wter nd geotherml heting systems.  mnufcturer’s certificte is required to clim the cred

In tody’s column we hve reviewed few txlw chnges tht my help sve few txllrs on your 009 return.  We hve only hd time to cover the bre s of these chnges.  Feel free to cll our office or consult with your tx professionl to flesh out the detils.

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