Home Back Issues February 2009 Tax law changes will impact 2008 returns

Tax law changes will impact 2008 returns

| Print |  Email
Archives - February 2009
Sunday, February 01, 2009

The taxman cometh in just a few short months, and though you probably won’t have to declare the pennies on your eyes, as George Harrison once advised, several key changes in tax laws are definitely worth knowing about in advance of April 15.


“There were so many tax acts this past year, so education is a big part of what we’ll be doing with our clients,” says Daniel Monaghan Jr., senior tax manager at the Portland accounting firm Perkins & Co.

Two major federal laws, the Economic Stimulus Act of 2008 and the Emergency Economic Stabilization Act, each came with several tax provisions that will impact 2008 returns.

The first increased the Section 179 deduction for new equipment put into service in 2008 from $125,000 to $250,000. The cap on equipment spending covered by the deduction was also raised for 2008 from $500,000 to $800,000.

Monaghan notes that businesses that don’t qualify for the Section 179 deduction are eligible for a 2008-only bonus depreciation, through which they can write off 50% of the cost of equipment and then depreciate the other 50%.

The second new law, aka “the bailout,” extended several business tax provisions that were set to expire. Among them, the depreciation timeline for qualified leasehold improvements made by, for instance, a tenant renting office space.

In the past, those improvements have been depreciated over 39 years, but that was temporarily changed for 2007 — and now extended through 2009 — to 15 years.

In addition, the bailout made changes that are in effect for the 2009 tax year, including extending a research and development tax credit and allowing employers to provide up to $240 to employees who commute by bike. It also eliminated restrictions so that more businesses can qualify for a 30% tax credit on solar power installations; in Oregon, businesses are also eligible for a credit of up to 50% of the cost of a solar project over five years.

This year also will bring a tax break to Portland businesses in the form of a reconfigured business license tax, which will now be paid at the end of each year instead of in advance.

As for what else 2009 — and the new Obama administration — may bring in terms of taxes, Monaghan says the new president’s campaign was heavy on tax reform, but until anything becomes law, there’s little point in speculating.

“We don’t trust anything until the president signs it,” he says.

JON BELL




Have an opinion? E-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it
 

More Articles

Green eyeshades in the ivory tower

News
Friday, April 04, 2014
EducationCosts BlogBY ERIC FRUITS

The rapidly rising cost of higher education has left even the smartest researchers and the wonkiest of wonks wondering what’s happening and where’s all that money going. More and more, prospective students—and their families—are asking: Is college worth the cost?


Read more...

From the Editor: The human factor

March 2014
Tuesday, February 25, 2014

In this issue, we celebrate our 21st annual 100 Best Companies to Work For in Oregon project.


Read more...

Car ignition recalls and lean product design

Contributed Blogs
Friday, April 11, 2014
04.11.14 thumb gm-gettyTOM COX | OB BLOGGER

The auto industry is starting to share more costs across manufacturers for complex and challenging design work, like new transmission design, and certain new engine technologies. What we’re not yet seeing is wholesale outsourcing of “unavoidable waste” components to specialist companies.


Read more...

Spreading the wealth

March 2014
Tuesday, February 25, 2014
HiResBY PAIGE PARKER

A money management firm broadens its reach. 


Read more...

Q & A with Chuck Eggert

News
Thursday, March 06, 2014
03.06.14 thumb pacfoodsBY HANNAH WALLACE | OB BLOGGER

The founder of Pacific Foods talks about why his company has flown under the radar in Oregon, how saving a family-run chicken hatchery has helped his bottom line and why he thinks organic food is anything but elitist.


Read more...

Leader's bookshelf

Contributed Blogs
Friday, March 14, 2014
02.06.14 BooksBY TOM COX | OB BLOGGER

Five books that will make you a better leader.


Read more...

Why I became an educator

News
Tuesday, March 04, 2014
03.04.14 thumbnail teachBY DEBRA RINGOLD | GUEST CONTRIBUTOR

How can we strengthen the performance of institutions charged with teaching what Francis Fukuyama calls the social virtues (reciprocity, moral obligation, duty toward community, and trust) necessary for successful markets and democracy itself?


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS