Delcare the pennies on your eyes

“ …‘Cause I’m the taxman, yeah, I’m the taxman. And you’re working for no one but me.”

It’s a line from Taxman, a little ditty from The Beatles. While I did get The Beatles Rock Band for Christmas, it’s not the reason I’m singing that song. I’m working on my taxes. And when I say “working,” I mean staring at stacks of papers with a glazed look and sighing deep, loud sighs.

My husband and I are business owners – newbies, actually. We launched a business in October 2008, just as the economy tanked. Gotta love our timing, eh?

Although our business was pretty slim in 2009, there are some tax law changes that will work in our favor.

2009 tax law changes
The American Recovery and Reinvestment Act (ARRA) earlier this year extended a number of expiring provisions and created a few more, according to tax writer Mark Battersby, who wrote about this topic in our October issue, "Year-end tax planning," Page 24.

• ARRA extended the 50 percent bonus first-year depreciation allowance available in 2008 to 2009.
• During 2009, businesses can choose to expense and immediately deduct up to $250,000 of the cost of qualifying property and equipment. The $250,000 maximum expensing amount is reduced if the cost of all Section 179 property placed in service in 2009 exceeds $800,000.
• For tax years beginning in either 2009 or 2010, ARRA eliminates the corporate level tax on the built-in gains of an S corporation that converted from regular C corporation status at least seven tax years before the current tax year.

And there are some tax laws that expire in 2009. Make sure you don’t miss them.

• Reduced estimated tax payments for small businesses
• The tax credit for research and experimentation expenses
• Increased alternative minimum tax (AMT) exemption amounts
• Renewal community tax incentives
• The FUTA surtax of 0.2 percent

If you missed the tax story the first time, that’s okay. Click here to read the article.