Tax Changes

Alert: New Last Minute 2009 Tax Law Changes:

PAGE 12 CHANGE: The state of Connecticut has increased their top tax bracket to 6.50% for people with the tax filing statuses of MFJ over $1,000,000; SNG and MFS $750,000 and $800,000 for HH.  The most common rate remains at 5.00%

PAGE 13 CHANGE: Reciprocal State Income Tax Agreements.  The state of KY has reciprocal agreements with, IL, IN, MI, OH, VA, WV and WI.  The state of KY does not have agreements with ND or PA.

PAGE 40 CHANGE:  First-Time Homebuyer Tax Credit:

The $8,000 credit is phased out for people with tax filing status of Married Filing Joint (MFJ) with AGI's between $225k to $245k and SINGLE (SNG) between $125k to $145k.  If AGI is over $245,000 and you file MFJ, no credit is allowed, if AGI is over $145,000 if filing SNG, no credit is allowed.  Additionally, a new tax credit of up to $6,500 is available for qualified "move-up buyers" who have lived for 5 consecutive years out of the preceding 8 years in their previous house.  The new home purchase price can not be more than $800,000 to qualify for either the $8,000 or $6,500 tax credit.  The taxpayer must enter into a binding contract before May 1, 2010 then close on the new principal residence before July 1, 2010 in order to be eligible for the tax credits.  Please note, the effective date of the new "move-up buyers" credit of $6,500 is 11/6/09.

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