Standard Deduction Changes
There are some really interesting changes this year for those who take the standard deduction. In prior years you either took the standard deduction or you itemized. Well, this year we have a new form. The new form is Schedule L, and if you don’t itemize this could be really good news on your 2009 tax return.
So what is new? There are several things actually. It started last year with the addition of being able to deduct a portion of your real estate taxes even if you didn’t itemize. Well that continues forward to this year. The deduction is $500($1000 if filing jointly) or real property taxes paid, whichever is less. This is especially helpful to those who have a small mortgage, or who have paid off their mortgage. Due to the size of their mortgage, or no mortgage at all, they didn’t have enough to itemize.
There is deduction for 2009 for taxes paid on a qualified motor vehicle. This deduction applies to purchases Between February 18 and December 31, 2009. The taxes this applies too are generally any state or local sales taxes or excise taxes on these qualified motor vehicles. So what is a qualified motor vehicle? 1) A new car or light truck with a gross vehicle weight rating of 8500 lbs or less. The original use of the vehicle generally must begin with the taxpayer. 2) A motorcycle with a gross vehicle weight rating of 8500 lbs or less. The original use of the vehicle generally must begin with the taxpayer. 3) A motor home. The original use of the vehicle generally must begin with the taxpayer.
The deductible amount of tax is limited to the tax on the purchase price up to $49,500. Of course, like so many tax deductions, there is a phase out on this deduction. The phase out is for taxpayers with MAGI of $125,000 and $135,000($250,000 and $260,000 if filing joint).
There is also now a deduction available for those who are in a Federally Declared Disaster Area. This deduction is for net disaster losses incurred. It is a deduction from AGI without limitation. For further information on disaster areas you can go to FEMA’s website.
The information contained on this site should in no way be considered to be professional advice in the form of either tax, accounting, or legal service or consultation. You should always consult with a professional familiar with your individual circumstances before making any specific decisions related to accounting, tax, or legal matters.
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