Wednesday, March 4, 2009

IRS Information Related to the American Recovery and Reinvestment Act of 2009

Congress has approved and the President has signed new economic recovery legislation, the American Recovery and Reinvestment Act of 2009. The IRS is implementing tax-related provisions of this new program as quickly as possible.

Here are some key highlights:
More information on these and other provisions of the recovery program will be available on the IRS website,, as it become available.

Following are a few general questions and answers regarding the new recovery package:

Could the new law affect 2008 tax returns?
Generally, no. The new law does not have any major impact for the vast majority of individuals preparing their 2008 tax returns due April 15. Instead, these changes will largely impact 2009 tax returns filed next year, in 2010. Taxpayers should continue to prepare their 2008 tax returns as they normally would.

There are a few limited areas in the law that could impact 2008 tax returns. For some small businesses, changes in the net operating loss provisions could affect 2008 tax returns. And for first-time homebuyers there is an expanded credit available on 2008 tax returns.

Does this new recovery program have any impact on the recovery rebate credit for 2008 tax returns being filed now?
No. But the IRS reminds taxpayers and tax preparers to make sure they properly determine eligibility for the recovery rebate credit before they file their 2008 federal tax returns.

Where are more details on the tax provisions of the recovery law?
The IRS will be providing more details on this web site as they become available. A summary of the key provisions is available from the Senate Finance and House Ways and Means committees.

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