INFORMATION FOR THE 2009 TAX YEAR
For more information on any of these changes/credits, please contact us or visit the IRS web site with this link. IRS Tax Law Changes
First Time Home-buyer's Credit
If you purchased a home in 2009, you may qualify for this credit. If you had not owned a home for the three years prior to the purchase, then you may qualify for a credit up to $8000. If you owned a home for at least 5 out of the 8 years prior to the purchase, you may qualify for a credit up to $6500. You may claim this credit for home purchases made during the 2009 tax year or for purchases made/contracts entered into before April 30th, 2010.
Unemployment Income Reporting
If you received unemployment income during the 2009 tax year, you may exclude the first $2400 that you received from the amount that you report on your taxes. If you are married and BOTH you and your spouse received unemployment income, you many both exclude the first $2400 that you received from the amount that you report. (This does NOT mean that if only one of you received unemployment you would be able to deduct $4800 for being married. The $2400 applies to each of you separately.)
Special Deduction On NEW Vehicle Purchases
Taxpayers who purchase a NEW vehicle during the 2009 tax year may qualify for a special sales tax deduction. This deduction can be taken even if you don't itemize! Purchases must be made between February 16th and December 31st of 2009. The vehicle cannot weigh more than 8500 pounds (motorhomes are not subject to the weight limit). For those of you who do itemize your deductions on schedule A and take the general sales tax deduction, you can continue to add the sales tax from new motor vehicle purchases to your general sales tax calculation.
Making Work Pay Credit/Government Retiree Credit
This credit was given to everyone by adjustments made to the federal withholding in their paychecks throughout 2009. However, you still have to fill out Schedule M with your 2009 federal tax return in order to reflect the credit. If you prepare your taxes without supplying the Schedule M, your refund will be lower than it should be and in some cases you could end up owing money. Make sure that you or your preparer complete this form if you qualify.
Economic Recovery Payment
If you receive social security benefits, supplemental security income (SSI), railroad retirement benefits, or veterans disability compensation or pension benefits, you may have received a check during 2009 for $250. This payment is not taxable on your 2009 tax return.
Property Tax Deduction For Those Who Don't Itemize
For those of you in 2009 who do not use Schedule A, you can continue to take a deduction for up $500 paid in property taxes in addition to your standard deduction. If you file as Married Filing Jointly, you can deduct up to $1000 in paid property taxes in addition to the standard deduction.
Residential Energy Credits
The energy credits that were discontinued during the 2008 tax year were reinstated for the 2009 and 2010 tax years. You may take a 30% credit for the cost of certain qualifying energy improvement property up to a total of $1500 total for both 2009 and 2010.
Items such as qualified solar electric property costs, qualified solar water heating property costs, qualified small wind energy property costs, and qualified geothermal heat pump property costs will not have a credit limitation.
The cost of certain high-efficiency heating and air conditioning systems, water heaters and stoves that burn biomass all qualify, along with labor costs for installing these items. In addition, the cost of energy-efficient windows and skylights, energy-efficient doors, qualifying insulation and certain roofs also qualify for the credit, though the cost of installing these items does not count.
Not all energy-efficient improvements qualify for these tax credits. For that reason, homeowners should check the manufacturer’s tax credit certification statement before purchasing or installing any of these improvements. The certification statement can usually be found on the manufacturer’s website or with the product packaging. Normally, a homeowner can rely on this certification. The IRS cautions that the manufacturer’s certification is different from the Department of Energy’s Energy Star label, and not all Energy Star labeled products qualify for the tax credits.
This credit can be taken regardless of whether or not you itemize utilizing form 5695.
SAVE FOR THE FUTURE
You can elect to receive your federal tax refund in the form of government issued Series I Savings Bonds using form 8888. Your bonds need to be in increments of $50 and your purchasing limit is $5000. You must have the remainder of your refund direct deposited into a bank account. These bonds cannot be issued in any other person's name. If you are married, they will be issued in both of your names.