(This is a continuation of the above post, confirmation that I don't really have a life.)
The next big question was whether we should prepay the balance of our State income and property taxes in order to claim an itemized deduction for 2008. To answer that question, we needed to know whether we will be subject to the Federal Alternative Minimum Tax. (State taxes are not an itemized deduction under AMT.)
My hasty calculations indicated that we’re on the cusp of being an AMT-payer. The good-and-bad news is that there was little point in cutting a check on December 31st to the beleaguered State of California or County of San Mateo because we wouldn’t be able to deduct it on our 2008 taxes, yet may do so in 2009.
I made donations to the regular charities and a few new ones, and we made the mortgage payment that was due on January 1st. (Mortgage interest and charitable contributions are deductions under both the AMT and regular-income tax regimes.)
One always gets a measure of satisfaction in knowing where one stands, though the news may not be welcome. © 2009 Stephen Yuen