On October 3, 2008, Congress passed the Emergency Economic Stabilization Act of 2008 (also known as the “Bailout Package”), which contained a number of tax extenders and other tax provisions affecting a large number of taxpayers. The bill contains individual tax relief, extension of expiring tax items, incentives for energy production and conservation, relief for taxpayers in certain disaster areas, and other tax provisions.
Some of the tax provisions affecting taxpayers are:
- The AMT exemption for 2008 is $69,950 for MFJ and $46,200 for others.
- Nonrefundable personal credits are allowed against AMT for 2008.
- The deduction for state and local sales taxes is allowed for 2008 and 2009.
- The deduction for qualified tuition and related expenses is allowed for 2008 and 2009.
- The deduction for teachers’ out-of-pocket expenses is allowed for 2008 and 2009.
- The additional standard deduction for real property taxes for non-itemizers is extended for 2009.
- The base threshold for calculating the refundable child tax credit is decreased to $8,500 for 2008.
- The exclusion for discharge of qualified principle residence indebtedness is extended to December 31, 2012.
