2009 RMD’s SUSPENDED FROM QUALIFIED RETIREMENTS ACCOUNTS 

A participant or beneficiary who doesn’t need the money can skip the distribution in 2009, and pay ordinary income tax on the later distribution of the full (and perhaps fully recovered) value of the assets, or may benefit from taking and paying tax on a distribution in 2009, and then using the proceeds to buy back the same asset at the current low price.

2009 MILEAGE RATES RELEASED
For 2009, the rate is 55 cents per mile for business use (down from 58.5 cents per mile for the second half of 2008), 24 cents per mile for medical and moving purposes (down from 27 cents per mile for the second half of 2008), and 14 cents per mile for vehicles used for charitable purposes (the same rate as for 2008).

FIRST-TIME HOMEBUYER CREDIT
The Housing Assistance Tax Act of 2008 has made a new tax credit available to help taxpayers purchase their first home. Specifically, individuals who have not owned a home in the last three years can qualify for a refundable income tax credit when they purchase a principal residence in the United States. The credit applies to purchases made after April 8, 2008, and before July 1, 2009, even if the taxpayer entered into a binding contract to purchase the home before April 9, 2008.

Planning Note:
A taxpayer who purchases a home during the eligible period in 2009 can elect to treat the purchase as having been made on December 31, 2008. Taxpayers can file amended returns for this purpose.
ENERGY TAX CREDITS FOR INDIVIDUALS
Taxpayers should not forget to take advantage of a host of energy tax incentives available for energy efficient improvements made to their home and the purchase of energy-efficient property. The incentive that impacts most individuals is the credit for the purchase of "residential energy property," such as residential exterior doors and windows, metal roofs, insulation, heat pumps, furnaces, central air conditioners and water heaters.9 The credit is limited to a maximum of $500 for all tax years and no more than $200 of the credit can be based on expenditures for windows.

Caution:
The residential energy property credit is available for qualifying property placed in service in 2006, 2007 and 2009. It is not available for property placed in service in 2008.
Additional Standard Deductions
For 2008 and 2009, an individual taxpayer who does not claim itemized deductions may nonetheless claim an additional standard deduction of up to $500 ($1,000 for married couples filing jointly) for state and local property taxes paid or incurred during the year.

Comment:
The election of taxpayers who itemized deductions to claim state and local general sales taxes in lieu of state and local income taxes was also extended to apply to tax years 2008 and 2009.