New tax law – Emergency Economic Stabilization Act

On October 3, 2008, President Bush signed the "Emergency Economic Stabilization Act," which included an AMT "patch" and extension of a number of popular tax breaks, most of which had expired at the end of 2007. Here's a quick summary of provisions extended through 2009.

 

* Deduction for state and local sales taxes in lieu of deducting state and local income taxes.

 

* $2,000 / $4,000 above-the-line deduction for higher education tuition and fees.

 

* Business tax credit for research and development expenditures.

 

* 15-year recovery period for certain leasehold improvements.

 

* Tax-free contributions from IRAs to charities by taxpayers aged 70½ and older.

 

* The additional standard deduction for property taxes  paid by those who don't itemize.

 

The law also extended some energy tax credits and deductions and provided additional tax relief for victims of disasters in federally declared disaster areas.

 

For 2008, the AMT exemption amounts are increased to $46,200 for singles and to $69,950 for joint filers.

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