In addition to extending the Bush tax cuts, providing relief from the AMT, and cutting the payroll tax by two percentage points, the recently enacted “Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010” (Tax Relief Act) extends a host of other important tax breaks fo

2010 Tax Relief Act's Two-Year “Sunset Relief” Protects Key Individual Tax Breaks

By Michael D. Fisher, CPA, MST

Senior International Tax Manager, PIASCIK

A Statement of the Problem

Legislatures and government tax authorities worldwide have long recognized that affiliated companies under common control sometimes have the ability to exploit differences in tax environments between nations through the artful adjustment of transfer prices within corporate groups constituting integrated enterprises.

While the new law tax changes in the health reform legislation and the hiring legislation were the most significant developments in the first quarter of 2010, many other tax developments may affect you, your family, and your livelihood.

Although there are only about four weeks left to go before the year ends, it's not too late to implement some planning moves that can improve your tax situation for 2009 and beyond. This letter reviews some actions that you can take before December 31 st to improve your overall tax picture.

Dear Mr. Smith:The following is a summary of the most important tax developments that have occurred in the past three months that may affect you, your family, your investments, and your livelihood.  Please call us for more information about any of these developments and what steps you should implement to take advantage of favorable developments and to minimize the impact of those that are unfavorable.

H.R. 1, the “American Recovery and Reinvestment Act of 2009”—the Recovery Act—was signed into law by the President on February 17, 2009. This new law includes many business tax breaks, such as extended bonus depreciation, boosted expensing, and tax-deferred debt forgiveness income on the repurchase of qualifying debt. Tax breaks for individuals include a refundable “making work pay” stimulus credit, enhanced child tax credit and EITC, an improved homebuyer credit, a new deduction for state sales and excise taxes paid on new vehicles, and a sweetened higher education credit. There's a one-year AMT patch as well.

The Recovery Act is over 1,100 pages and covers an extraordinary number of tax relief provisions. However, I'm writing to give you an overview of the more widely applicable tax changes specifically effecting both individuals and families and small businesses. 

Tax Changes in How Individuals are Affected by The Emergency Economic Stabilization Act of 2008

On Mar. 30, 2010, President Obama signed into law H.R. 4872, the Health Care and Education Reconciliation Act of 2010 , thus completing a massive overhaul of the U.S. health care system affecting nearly all taxpayers, many employers, and many elements of the health care industry.