Last-Minute Tax Saving Tips – New IRS Changes Could Save You Money

I’ve blogged about ways to save on your taxes in 2008.  But is there anything you can do to trim last year’s IRS bill now that 2009 is here?

The following tax saving tips for 2008 include a second go at the economic stimulus rebates, new property tax deductions, and new personal loss casualty write offs.

If you are a new home owner, someone who missed out on the last round of stimulus rebates, or someone hit hard in a federally-declared disaster area – listen up!

‘Second Bite at the Apple’ for Last Year’s Economic Stimulus Rebates

In 2008, you had the chance to collect an economic stimulus rebate payment based on your 2007 tax return. The maximum amount was $1,200 for a married joint-filing couple and $600 for all others. Those taxpayers with children could be eligible for an additional $300 per child.

For those taxpayers that did not receive a rebate or who received less than the maximum, they have another opportunity to collect the rebate- based on information reported on your 2008 tax return.  Potentially, taxpayers can collect the difference between the maximum rebate and what they received last year.

New Property Tax Deductions for Nonitemizers

If you don’t itemize deductions, you may qualify for a new write-off for state and local real property taxes. The new deduction is in addition to the standard deduction. The maximum add-on is $1,000 for married joint-filers and $500 for all other taxpayers.

If you bought or plan to buy a home between April 9, 2008, and June 30, 2009, you may qualify for a new tax credit. However, you’re only eligible if you haven’t owned a principal residence in the U.S. during the three-year period leading up to the purchase date. The maximum credit equals the lesser of: 10% of the home price or $7,500 for married filing joint status and $3,750 for married filing separate status.

The credit offsets both your regular tax and the alternative minimum tax (AMT) and is refundable. Which means that the government will refund any amount after the credit has been used to offset your total federal income tax.

The bad news is the taxpayer must repay the credit over 15 year period.

New Personal Casualty Loss Write-Off Guidance for Itemizers

If you itemize and suffer a personal casualty loss, the existing rules say that you can claim a deduction to the extent the loss exceeds 10% of  adjusted gross income (AGI). However, a new rule, suspends the 10%-of-AGI threshold for 2008 disaster-related losses in federally-declared disaster areas.

New Personal Casualty Loss Write-Off for Nonitemizers

For those taxpayers who do not itemize, the standard deduction amount can be increased by a disaster-related personal casualty loss which was suffered in 2008. Only losses in federally-declared disaster areas are eligible for this new break.  Due to many weather-related disasters this past year, many taxpayers will now be eligible for this tax-saving assistance.

More Tax Help, IRS News and Tax Relief Tips:

  1. 10 Things Taxpayers Can Do Before December 31, 2008 to Reduce the Tax Bill Due on April 15, 2009

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One Response to “Last-Minute Tax Saving Tips – New IRS Changes Could Save You Money”

  1. Tax Benefits for Education: Deduction of up to $4,000 Available for Tution and Fees | Tax Relief Tips from the Experts at Tax Resolution University Says:

    [...] Read about more last minute tax tips that can save your money. [...]

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