Wednesday, February 17, 2010

5 Tax Law Changes you MUST Know About

Earlier in the week, I provided Marvelous Girl – an online woman’s interest magazine – with information on five important tax law changes for 2010. I wanted to make sure and share the advice with all of my blog readers as well. You can find a summary of the important tax law changes below or checkout the full article at Marvelous

  • Newly Expanded Home Buyer Credit – If you were thinking about buying a home, get a move on! Congress approved the newly expanded homebuyer credit which counts for all homes with closing dates before April 30, 2010. First time homebuyers are eligible for up to $8,000 in refundable credit for new home purchases!
  • Increased Contribution Limit for 401(k) Plans – Invest in your retirement! The maximum employee contribution rises to $16,500 from $15,500 in 2009 for these and similar workplace retirement plans including 403(b)s and the federal Thrift Savings Plan.
  • Tax Credit for College Tuition – For 2009 and 2010, the new American Opportunity credit provides up to $2,500 per student a year for four years of college, not just the first two years. It now also covers the cost of books!
  • Higher Annual Gift Tax Exemption – For 2009, you can give up any individual up to $13,000 without owing any gift tax, a $1,000 increase over 2008.
  • Partial Exclusion for Unemployment Benefits – While your unemployment checks are usually considered taxable income, in 2009, the first $2,400 you received will not be taxed. Simply subtract that amount from the total benefits your received (which should be reported to you on form 1099-G).

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