Federal Stimulus Bill Provides Tax Benefits
The American Recovery and Reinvestment Act also known as the Federal Stimulus Bill provides a number of new benefits for tax payers and the unemployed. Included in the new federal law is an AMT patch, First Time Home Buyer Credit, and a Car Buyer Tax Deduction.
The Alternative Minimum Tax continues to affect more and more Americans as salaries gradually increase over time and the tax law does not adjust or index to inflation. In the recently enacted stimulus bill, the federal government has patched the AMT law to keep levels similar to last year to protect millions from paying the higher tax rates.
First Time Home Buyer Credit
Congress and the President saw the need to increase home sales to refuel the economy and therefore included the First Time Home Buyer Credit in the new law. This credit unlike previous similar credits does not have to be repaid and goes as high as $8,000 when a home is purchased between January 1, 2009 and December 1, 2009.
Car Buyer Tax Deduction
Regardless of whether you itemize or use the 1040 EZ tax form, you can tax a deduction for automobiles purchased during 2009. The credit includes all state and all local sales and excise taxes associated with the car purchase.