Six Year-End Tax Savings Tips From Thomson Reuters

NEW YORK, Oct. 12 /PRNewswire-FirstCall/ -- While 2009 has been an
economically tough year for many, you may be able to cut your 2009 tax burden,
according to Harris Abrams, senior tax analyst from the Tax & Accounting
business of Thomson Reuters. "There are a number of steps you can take in the
next few months to reduce your taxes for this year," he says. "But these
opportunities could be lost if you don't act on them soon."

To maximize your tax savings, Abrams advises taxpayers to immediately see if
any of the following maneuvers will work - some of these opportunities will
not be available next year:

1. Uncle Sam can help you buy a house. You may remember last year's
Housing
Act included a tax credit giving first-time homebuyers up to a $7,500
credit for buying a home between April 9, 2008, and June 30, 2009, for
single taxpayers with modified adjusted gross income (MAGI) up to
$75,000
and married couples with MAGI up to $150,000 qualifying for the full
tax
credit. However, the credit had to be paid back over time. Now,
Congress
has 're-built' the credit. First and foremost, the 2009 legislation
eliminated the repayment requirement for homes purchased on or after
January 1, 2009. (There is an exception: homeowners who sell the house
within three years of purchase must pay the credit back.) The 2009 law
also extends the credit through the end of Nov. 2009, and bumps up the
maximum credit amount to $8,000. However, by the time you are reading
this, the credit could have been extended.
2. Uncle Sam can help you buy a new car. If you buy a new vehicle -
including a light truck, SUV, motorcycle, or motor home - you can
deduct
state and local sales taxes paid on up to $49,500 of the purchase
price,
whether you itemize or not. You must buy the vehicle by Dec. 31, 2009.
The tax break starts to phase out if your MAGI is $125,000 ($250,000
for
joint filers) or more this year. And the deduction can't be taken next
April if you elect to deduct state and local sales taxes in lieu of
state
and local income taxes.
3. Uncle Sam can help you buy a computer for school. Many taxpayers
maintain
a qualified tuition plan (also known as a '529 plan') to save for
education expenses. These plans allow your savings to grow tax-free,
and
to be distributed tax-free as long as the distribution is used to fund
certain education expenses. For 2009 and 2010 only, you can use funds
from your qualified tuition plan to pay for computer technology and
equipment, and Internet access and related services. Prior to 2009, you
could use these funds to buy a computer only if the computer was
required
by the college or by a specific degree program or course. So, the new
rules make it much easier to buy a new computer for any student in your
family with tax-free dollars.
4. Uncle Sam can help you help others via charity. You can distribute up
to
$100,000 per year from your IRA directly to a qualified charity without
paying any tax on the distribution. This exclusion is available if you
are age 70 1/2 or older, but act quickly - this tax break is scheduled
to
expire at the end of 2009.
5. Uncle Sam can help small business owners. If you run a small business,
you can elect to write off the cost of certain capital expenses when
you
make an acquisition, instead of recovering those costs over time
through
depreciation. Congress has temporarily increased the amount that small
businesses can write off for capital expenditures incurred in 2009 to
$250,000 and increased the phase-out threshold for 2009 to $800,000.
That
is, if the total cost of qualifying property that you place in service
in
2009 is more than $800,000, the immediate deduction limit is reduced by
that extra amount. For example, if you place in service $810,000 of
qualifying property in 2009, you can make the election for no more than
$240,000 of property: $250,000 minus $10,000 (the excess of $810,000
over
$800,000). Remember that the $250,000 and $800,000 amounts are
scheduled
to be reduced for qualifying property placed in service in tax years
beginning after 2009.

6. More tax help for business owners. Businesses can recover the costs of
some capital expenditures faster than the ordinary depreciation
schedule
would allow by immediately writing off 50 percent of the cost of many
types of depreciable property acquired in 2009 for use in the U.S. This
break is available for most types of tangible personal property,
certain
improvements to leased real property, and most software, but expires
for
most eligible property at the end of 2009.

About Thomson Reuters

Thomson Reuters is the world's leading source of intelligent information for
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headquarters in New York and major operations in London and Eagan, Minnesota,
Thomson Reuters employs more than 50,000 people and operates in over 100
countries. For more information, go to www.thomsonreuters.com.

The Tax & Accounting business of Thomson Reuters is the leading provider of
technology and information solutions, as well as integrated tax compliance
software and services to accounting, tax and corporate finance professionals
in accounting firms, corporations, law firms and government. Tax & Accounting
includes the Professional Software & Services, Corporate Software & Services,
and Research & Guidance business groups.

SOURCE Thomson Reuters

Melissa Lande, 1-800-993-7600, +1-215-654-7950, mlande@landepr.com, or Pam
Bruno, +1-203-461-9409, pbruno@landepr.com, both of Lande Communications, for
Thomson Reuters