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Page 6-45: In Table 4 (Effective October 1, 2008–September 30, 2009), for Maryland (MD), the per diem rates have been revised as follows:
Page 6-46: In Table 4 (Effective October 1, 2008–September 30, 2009), for Michigan (MI), the per diem rates have been revised as follows:
Page 6-51: In Table 4 (Effective October 1, 2008-September 30, 2009), for South Carolina (SC), the per diem rates have been revised as follows:
Page 10-14: at the top of the page, the carry over paragraph should read as follows; “…on page 10-42). The credit amount will be limited to no more than $3,750 for those married couples filing separately. This maximum limitation also applies to unmarried individuals purchasing a home together. …” In addition, the following Filing Tip should be inserted following the Caution: Filing Tip. The IRS has issued Notice 2009-12 explaining how the first-time homebuyer credit may be allocated among unmarried individuals purchasing a principal residence together. The total credit, as stated above, cannot exceed $7,500. However, if two or more individuals purchase house and can satisfy the requirements under IRC §36, they may allocate the credit using any reasonable method. However, the method cannot allocate any portion of the first-time homebuyer credit to an individual who is not eligible to claim the credit. Two reasonable methods are; (1) allocation based on each individual’s contribution to the purchase price and (2) allocation based on ownership interest as tenants in common. Page 10-14: Insert the following material at the end of “First-Time Homebuyer Credit” and just before “Earned Income Credit” Increased Amount for 2009 The American Recovery and Reinvestment Tax Act of 2009 (P.L. 111-5) made several key modifications to the first-time homebuyer credit (IRC §36) which potentially affects taxpayer’s 2008 income tax returns. The key changes are:
The special election to treat a purchase after December 31, 2008, as having occurred on December 31, 2008, still applies and the increase amount for 2009 is claimed. In addition, the recapture waiver will also apply to taxpayer’s making this election. Filing Tip. Qualified first-time homebuyers planning to make a purchase after April 15, 2009, should consider filing a request for an extension of time to file. However, for purchase closer to October 15, 2009, a taxpayer will need to weigh the advantages of filing an extension, filing timely and then amending the 2008 income tax return, or simply claiming the first-time homebuyer credit on the 2009 income tax return. Caution. The modifications of the first-time homebuyer credit were not made retroactive. For purchase made between April 8 and December 31, 2008, the original rules still apply. If the taxpayer claimed the credit, repayment is still required beginning in 2010. The accelerate recapture provision will also apply to these purchase when the home is sold or ceases to be used as a principal residence.
The refundable AMT credit was enacted to give relief to individuals who exercised incentive stock options that later lost a significant portion of, or all of, their value in later years. Since the difference between the fair market value and the option price is a preference item for AMT purposes, these taxpayers paid an increased amount of tax but generated a credit for use in later years when, hopefully, the stock was sold for a profit. The loss in value of the stocks resulted in these individuals being unable to use a portion, if any, of the sizable amounts of AMT credit to offset their tax liability and they would simply carry the amount forward to the next year with similar results. For tax years beginning after December 31, 2007, the Emergency Economic Stabilization Act of 2008 (P.L. 110-343) increased the amount of long-term unused minimum tax credit that can be claimed. The minimum credit allowed will not be less than the greater of the amount of the AMT refundable credit amount determined for the preceding year or 50 percent of the unused credit. The minimum tax credit is the amount of AMT attributable to these deferral-type adjustments to reduce the taxpayer’s regular tax liability in a tax year by some or all for the AMT paid in previous years. Unused long-term minimum credit amount is defined as that portion of the minimum tax credit attributable to the adjusted minimum tax for tax years before the third tax year immediately proceeding such tax year. Thus, for 2008, taxpayers may be able to claim a refundable amount for credits generated from paying the alternative minimum tax in 2004. To claim the AMT credit, including the refundable portion, taxpayers must complete Form 8801, Credit for Prior Year Minimum Tax—Individuals, Estates, and Trusts. Filing Tip. For 2007, the minimum tax credit allowable could not be less than the AMT refundable credit amount regardless of the minimum credit otherwise allowable. An additional amount of the credit may be refundable. The refundable credit amount is equal to the greater of the lesser of:
The phase out calculation was identical to the phase out calculation for the personal exemption deduction Tab 13 Page 13-8: Credits for Families with Children Child Tax Credit. A qualifying child for purposes of the child tax credit must: 2. not have attained the age of 17 by the end of the calendar year;
Key Tax Figures 2005-2009
Page 16-14: Key Tax Figures 2005-2009 Under the heading “Child Tax Credit Refund Threshold,” the amount per child for 2008 should read $8,500. |
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