The Homa Files

Excerpted from WSJ, “Wealthy Likely to Benefit Most From 2009 Tax Changes”, Jan 6, 2009

Social Security taxes. The maximum amount of earnings subject to Social Security taxes rose to $106,800, up 4.7% from $102,000 in 2008.

AMT:  Unless lawmakers do something to pass relief from the alternative minimum tax,  tens of millions of Americans will have to pay higher taxes for 2009.

Estate Tax Exemption: Starting Jan. 1, the basic federal estate-tax exemption jumped to $3.5 million from $2 million in 2008. Transfers from one spouse to the other typically remain tax-free.  During the campaign, then-Sen. Obama proposed retaining the $3.5 million exclusion amount and the 45% top rate in coming years.

Exempt Gifts: The annual gift-tax exclusion rose to $13,000, up $1,000 from 2008. This means you can give as much as $13,000 this year to anyone you wish, or to as many people as you want, without having to worry about taxes or even having to file any forms with the Internal Revenue Service. It’s a simple way to help others and reduce the size of your taxable estate. You can give even more than that by paying directly for someone else’s tuition or medical expenses. Just be sure to pay the institution directly.

Retirement savings: The maximum amount that someone under age 50 can contribute to a 401(k) plan for 2009 rose to $16,500 from $15,500. Those 50 or older can put away an additional $5,500 this year, for a total of $22,000, up from $20,500.

Standard Deductions: The basic standard deduction for joint filers for the 2009 tax year will be $11,400, up from $10,900 for 2008. For singles, the amount for 2009 will be $5,700, up from $5,450.

Stealth taxes. These refer to laws that increase taxes owed by millions of upper-income Americans without actually raising the official tax rates. They’re known as stealth taxes because they’re often complex and difficult to detect.  For the 2009 tax year, most taxpayers will begin to lose some of the value of itemized deductions if their adjusted gross income exceeds $166,800, up from $159,950 in 2008.

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Source:
http://online.wsj.com/article/SB123128601819059077.html

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This entry was posted on January 20, 2009 at 7:04 am and is filed under Taxes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.