Tax News

CCH (cch.taxgroup.com) reports:

  The IRS has provided a reminder to taxpayers of the various tax breaks made available by the American Recovery and Reinvestment Tax Act of 2009 (P.L. 111-5). In many cases, taxpayers must take action within the 2009 or 2010 calendar years in order to take advantage of the tax benefits.

  --The expanded $8,000 first-time homebuyer credit under Code Sec. 36 requires a home purchase before December 1, 2009.

  --The deduction for the local sales and excise taxes of qualified new vehicle purchases (up to $49,500 in cost) under Code Sec. 164 requires the purchase of the vehicle before January 1, 2010.

  --The 30-percent credit for energy-efficient home improvements under Code Sec. 25C applies to improvements placed into service in 2009 and 2010.

  --The expanded Hope scholarship credit under Code Sec. 25A, temporarily applicable to the first four years of college rather than only the first two, applies to tax years 2009 and 2010.

  --The expansion of education savings plans under Code Sec. 529 to allow for the purchase of computer technology, Internet access and related services applies to 2009 and 2010.

  --Finally, the making work pay credit under Code Sec. 36A provides taxpayers with lower withholding rates in 2009. However, families in which both spouses work or taxpayers with multiple jobs may need to adjust their withholding in order to avoid lower refunds or tax liabilities for 2009.

IR-2009-67,
2009FED ¶46,430

Other References:

 
Code Sec. 25A

  CCH Reference - 2009FED ¶3830.20

 
Code Sec. 25C

  CCH Reference - 2009FED ¶3843.10

 
Code Sec. 36

  CCH Reference - 2009FED ¶4190K.11

 
Code Sec. 36A

  CCH Reference - 2009FED ¶4195.11

 
Code Sec. 164

  CCH Reference - 2009FED ¶9502.35

  CCH Reference - 2009FED ¶9602.7244

  CCH Reference - 2009FED ¶9602.87

 
Code Sec. 529

  CCH Reference - 2009FED ¶22,945.30

  Tax Research Consultant

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