The Housing Assistance Tax Act of 2008 allows homeowners to claim an additional standard deduction for property tax if the taxpayer does not itemize tax deductions. The additional amount is limited to $500 or $1,000 for joint filers. The additional standard deduction for property taxes is claimed as an additional amount on top of the standard tax deduction.

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The Internal Revenue Service (IRS) offers the following tax guidance concerning this additional tax deduction for property taxes:

The Additional Standard Deduction for Property Taxes applies to tax year 2008 only (most people file a 2008 tax return in 2009). This tax deduction is not available for any other tax year. For 2008, here are the standard deduction amounts:

Single: $5,450
Head of Household: $8,000
Married Filing Joint: $10,900
Married Filing Separately: $5,450
Qualifying Widow/Widower: $10,900
Dependent: $900-$5,450*
Additional Amount if Blind: $1,050
Additional Amount if age 65 or older: $1,050

Additional Amount for property taxes: $500 or $1,000 for married filing jointly
* Dependents must calculate their standard deduction using an IRS Worksheet.

This additional standard deduction will likely work more efficiently for taxpayers who have no mortgage interest to deduct, or whose total itemized deductions do not exceed their standard deduction. For example, married homeowners who are both over age 65 and who file a joint return would have a standard deduction amount of $14,000, which breaks down as follows:

* $10,900 standard deduction for married filing jointly, plus
* $1,050 for taxpayers age 65 and older for the husband, plus
* $1,050 for taxpayers age 65 and older for the wife, plus
* $1,000 additional standard deduction for property taxes for married couples.

Let's assume further they paid $10,000 in property taxes, and have no other itemized deductions, such as for mortgage interest or charity. In this case, their standard deduction is higher than their itemized deductions. Taking the standard deduction in this case would result in a lower overall tax than if they itemized.

Additional tax guidance and information is available at www.IRS.gov

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