Goodies in the Bailout Bill

Buried in the October bill are some nifty tax benefits for 2008 and beyond, as well as extensions of last year's breaks:

1.) An AMT fix. A one year patch might just save you from the alternate minimum tax. If your AMT-calculated income is below $69,950 for joint filers ($46,200 for singles), you likely won't have to pay.

2.) Mortgage debt forgiveness. Last year, Congress said that if you sold your home for less than you owed, restructured your mortgage or foreclosed through 2009, your canceled mortgage debt generally wouldn't be treated as taxable income. This deal is now extended throuhg 2012.

3.) A break on education. You can once again deduct up to $4,000 of school tuition if your adjusted gross income is $80,000 or less for singles ($160,000 for joint filers).

4.) A sales tax deduction. You still have the option to deduct state and local sales tax instead of income tax.

5.) Tax-free donations. If you're 70 1/2 or older, you can withdraw up to $100,000 from an IRA and give it to charity tax-free.

6.) Energy tax credits. In 2009, get a credit of up to $500 for energy-efficient fixes such as adding insulation and replacement windows.

Source: Money Magazine, December 2008