January 27th, 2010

It’s that time of the year again! Time to fill out those 1040′s and send your financial information in to the IRS.  For many, it’s a stressful time of the year, particularly those that may not have planned their taxes accordingly.

On February 17, 2009 President Obama signed the ARRA (American Recovery & Reinvestment Act).  This bill could have implications – positive ones – on your 2009 tax return.  Here are some highlights, although you should note that this is not an exhaustive list.

-”Making Work Pay” tax credit – this credit was given to employees through reduced with-holdings throughout the year.  It’s $400 per individual, or $800 per married couple.

-$8,000 tax credit for first-time homeowners.  This credit is available for all sales that close by July 1, 2010.

-$6,500 tax credit for home buyers that previously owned their own home at least 5 consecutive years out of the past 8 years.  Only purchases made after November 6, 2009 qualify for the credit.

-Deductibility of the sales taxes paid on a car purchase, assuming the car cost under $49,500.

-Increased Earned Income Tax Credits for those with 3 or more children, and an increased marriage penalty relief.

The ARRA was a good thing for many taxpayers.  For those that don’t really understand tax laws, or have complex tax situations – hiring a good tax return preparer would be a great idea.  You can find many leads through your local Yellow Pages and professional affiliations such as the American Institute of Certified Public Accountants or your State Board of Public Accountancy.

Soruce:

IRS.gov