The Bush administration's budget proposals include a number of tax provisions, so the Treasury Department has released an explanation of the fiscal year 2009 revenue proposals, also known as the Bluebook.
The administration's 2009 budget, as expected, called for extending the Bush tax cuts of 2001 and 2003. It also promotes improving compliance with the U.S. tax system. Other initiatives would provide a new standard deduction for health insurance of $15,000 for family coverage and $7,500 for single coverage.
In addition, the budget proposal extends provisions that provide AMT relief for one year. The proposal would increase the AMT exemption levels for 2008 to $46,250 for single and head-of-household filers, $70,050 for married taxpayers filing joint returns and $35,025 for married taxpayers filing separate returns. The proposal would also allow an individual to reduce their 2008 tax liability by the full amount of nonrefundable personal credits.
The Treasury Department has issued 16 proposals to help improve tax compliance, with an emphasis on improving information reporting. That includes requiring information reporting on payments to corporations, basis reporting on security sales, information reporting on merchant payment card reimbursements, and a Taxpayer Identification Number from contractors. It would also increase the information return penalties. The Treasury Department has requested $489 million for the IRS to increase its compliance efforts.
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