Possible Tax Law Changes for 2008

You can also review 2008 Tax Law Changes for Individuals.

H.R. 1424 - Division A: Emergency Stabilization Act (Bailout Portion)
Was passed by the House of Representatives and signed by President Bush on October 3, 2008 in the amount of 700 Billion dollars.

Division B:
Residential Energy Credit - Will expire for TY 2008 however will return for 2009 and 2010. Form 5695 will be updated to reflect this change.
New General Business Credit
Credit for new plug in qualified motor vehicles for 2009- New Form to follow.


Division C - Tax Extenders:

Highlights of this Bill are extenders to expiring tax provisions. Some of these provisions are:

H.R. 6275 - Alternative Minimum Tax Relief Act of 2008

This bill was extended as a one year patch on October 3, 2008 by the House of Representatives

To amend the Internal Revenue Code of 1986 to provide individuals temporary relief from the alternative minimum tax, and for other purposes.

This bill will:

• Increase and extend through 2008 the alternative minimum tax (AMT) exemption amounts; and
• Extend through 2008 the offset of certain nonrefundable personal tax credits against regular and AMT tax liability.

S. 3335 - Jobs, Energy, Families, and Disaster Relief Act of 2008

A bill to amend the Internal Revenue Code of 1986 to extend certain expiring provisions, and for other purposes.
This bill would implement the following:

• Extend the energy tax credit for solar energy and the residential energy efficient property tax credit through 2016.
• Extends the energy tax credits for fuel cell and microturbine property through 2017.
• Allows a new investment tax credit for combined heat and power system property.
• Directs the Secretary of the Treasury to study and report to Congress on Internal Revenue Code provisions that have the largest effects on carbon and other greenhouse gas emissions and to estimate the magnitude of those effects.
• Allows a tax credit for new qualified plug-in electric drive motor vehicles.
• Excludes from gross income reimbursements for bicycle commuting expenses.
• Delays until 2019 the application of special rules for the worldwide allocation of interest for purposes of computing the limitation on the foreign tax credit.
• Among many other provisions.

H.R.6081 - Heroes Earnings Assistance and Relief Tax (HEART) Act of 2008

To amend the Internal Revenue Code of 1986 to provide benefits for military personnel, and for other purposes.
This Bill was signed by President Bush on June 17, 2008 and became law the same day to provide benefits to military personnel and familys by making them eligible for more employer-offered benefits and government benefits. Some of the highlighted changes are:

• Allows a one-time tax credit of up to 10% of a home’s purchase price, with a maximum of $7,500, for service since 2001 in a combat zone. The tax credit would also apply to the survivors of service members who died of combat-related causes since 2001.
• Requires survivor benefits offered by companies to be extended to employees who die while on active military duty. Companies will have to treat soldiers killed in action as if they had returned to the workplace the day before they died.
• Allows a distribution of flexible spending account balances for reservists called to duty for at least 180 days.
  
• Creates a penalty for high net-worth taxpayers who renounce U.S. citizenship or terminate their U.S. residence to avoid U.S. taxes.
• Requires companies that offer differential pay to apply the benefit to every employee called to active duty, including those at all subsidiaries.
• Provides a tax credit equal to 20% of differential pay for companies with fewer than 50 employees. Differential pay also may be treated as wages instead of supplemental income.
• Allows retirement plan distributions to active service members but restricts participants from making contributions to the plan for six months after distributions begin.