The bailout bill passed Congress today and was signed into law by President Bush this afternoon. I’m of mixed opinion on the bailout portion of the bill. But I’m thrilled about one part of the bill—this year’s AMT (Alternative Minimum Tax) patch was included in the bailout legislation.
Every year Congress goes through the effort to raise the AMT exemption so that millions more individuals don’t get impacted by AMT. Last year Congress waited until December to pass an AMT patch and it impacted the filing season.
Also included in the bill were “extenders.” The extenders extended popular deductions that would have been eliminated.
Here is a list of some of the major tax items in the bill:
– AMT exemption increased to $46,200 for single and $69,950 for married filing jointly;
– Sales tax deduction extended through 2009;
– The Tuition and Fees deduction extended through 2009;
– Educator expense deduction of up to $250 extended through 2009;
– The real estate taxes deduction (for those taking the standard deduction) of $500 single/$1000 married filing jointly was extended through 2009; and
– Major tax benefits for those who live and/or work in major disaster areas.
There’s probably a lot more in the legislation (it runs 300 pages) but let me add a caveat: California will not be in compliance with any of these changes for 2008.