Stimulus Energy Tax Credit Program Offers Incentive to Replace Windows and Doors

27. September 2009 · Write a comment · Categories: General Tax · Tags: , , , , , , , ,

On February 17th, President Obama signed the 9 billion economic stimulus bill that includes tax credit incentives for homeowners who make energy-efficient home improvements. The bill extends eligibility for tax credits through 2010 on energy-efficient improvements — including qualifying windows and doors!

The bill includes the ability for homeowners to receive a tax credit of 30 percent of the cost of qualifying energy-efficient products (windows, doors, insulation, HVAC, and roofs), up to a maximum of ,500 per household for all improvements made in 2009 and 2010.

The requirements to qualify for the new energy tax credit include:

Windows purchased must be equal to or below a U-Factor of 0.30 and a Solar Heat Gain Coefficient (SHGC) of 0.30. The purchase of the qualified windows must be made during the taxable year for which the credit is being claimed. The credit is only allowed on the price of the qualified windows themselves, not on installation costs, onsite preparation, assembly or sales tax. The tax credit is allowable only for qualified window units placed in service in 2009 and 2010. Homeowners must save their receipts for purchased windows, along with all window labels and stickers for verification and tax recordkeeping. The windows must be installed in the taxpayer’s principal residence. This tax credit is capped at a total of ,500 for the years of 2009 and 2010. Unlike a tax deduction, which only reduces the amount of your taxable income, a tax credit reduces the amount of tax you owe.

ENERGY STAR® is a joint program of the U.S. Environmental Protection Agency and the U.S. Department of Energy helping us all save money and protect the environment through energy-efficient products and practices. Check out energystar.gov/tax credit for more information on the available federal tax credit when you purchase energy-efficient windows and doors.

Details of the First Time Homebuyer Tax Credit and NEW Existing Home Buyer Tax Credit

26. September 2009 · Write a comment · Categories: General Tax · Tags: , , , , , , ,

I came across a great website over the weekend www.federalhousingtaxcredit.com. This website is sponsored by the National Association of Home Buyers. Below is the information on the extended home buyer tax credits.

,000 First-time Home Buyer Tax Credit

The ,000 tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.
The tax credit does not have to be repaid.
The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of ,000.
The tax credit applies only to homes priced at 0,000 or less.
The tax credit now applies to sales occurring on or after January 1, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, a home purchase completed by June 30, 2010 will qualify.
For homes purchased on or after January 1, 2009 and on or before November 6, 2009, the income limits are ,000 for single taxpayers and 0,000 for married couples filing jointly.
For homes purchased after November 6, 2009 and on or before April 30, 2010, single taxpayers with incomes up to 5,000 and married couples with incomes up to 5,000 qualify for the full tax credit.

The ,500 Move-Up / Repeat Home Buyer Tax Credit at a Glance

To be eligible to claim the tax credit, buyers must have owned and lived in their previous home for five consecutive years out of the last eight years.
The tax credit does not have to be repaid.
The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of ,500.
The tax credit applies only to homes priced at 0,000 or less.
The credit is available for homes purchased after November 6, 2009 and on or before April 30, 2010. However, in cases where a binding sales contract is signed by April 30, 2010, the home purchase qualifies provided it is completed by June 30, 2010.
Single taxpayers with incomes up to 5,000 and married couples with incomes up to 5,000 qualify for the full tax credit.

Use Your Tax Refund To Pay For Your Life Insurance Policy Annually

26. September 2009 · Write a comment · Categories: General Tax · Tags: , , , ,

Every year, the average American receives around 00 in tax rebates (checks from the IRS with advance tax paid by you over the amount that you owe the IRS). With President Obama’s new stimulus tax breaks, this amount is likely to be higher in the coming years.

The average American treats the tax rebate check as free ‘spend’ money, not realizing that it’s his or her ‘forced savings’ money that the government is paying back. So instead of blowing it away, how about using it in more sensible, lasting ways? The most sensible thing you can do is pay for your life insurance with your tax refund.

Why spend your tax rebate on life insurance?
Think about it. The average American’s life insurance is less than adequate to deal with life’s emergencies. Toss in the recession and you have a situation where many have stopped payments on their life insurance policies. Some others have put off buying the much required, additional insurance because it is one of the first things to get struck off a home budget when money gets tight. On the contrary, life insurance is so vital to your family that financial distress should always be sorted out without touching your life insurance plan. Sometimes, this advice is easier said than done. However, put your peace of mind and the comfort of your family ahead of everything else.

What would happen to your family if you died? Even family members who are financially independent will have additional expenses after your death because they will have to make do without your salary to run the household, repay outstanding mortgage payments, the unpaid amount on your credit cards, etc. If you take care of certain tasks such as doing the household accounts, taking care of tax matters, etc currently, your spouse would have to hire these services after your death. Without life insurance, your family would be thrown off balance in so many ways.

Did you know that even bankruptcy laws exempt your life insurance policy because it affects your family’s interests? That’s how important your life insurance is. Simply use your tax rebate to pay for your life insurance annual charges, and it’s almost as if you got a free life insurance policy.

Choose term life insurance instead of whole life
When you buy life insurance with your annual tax rebates, opt for term life insurance because it is affordable, and the average tax rebate check can adequately pay the whole year’s premiums. Remember term life insurance rates can be guaranteed to remain even for the duration of the term, while your tax rebate check amounts may fluctuate. Term life is the cheapest form of life insurance, so even if your tax rebate goes down in any year, you can easily pay for your term life insurance. More importantly, shop around online, in order to qualify for the best term life rate class for your particular situation. Online life insurance agency websites offer you a choice of low-cost policies from reputed companies. If you find a really economical deal, you may not even end up spending your entire tax refund on term life insurance. With the money you save on low cost term life insurance, you will even be able to spend the rest of your tax rebate on a treat for yourself, or opt to pay off your bills – the choice is yours!

Tips

When you use your tax rebate check to pay for life insurance, pay your premiums for the full year. Apart from being the sensible thing to do, it will also save you more money on your premiums because paying the full year’s premium in one lump sum will work out cheaper than monthly payments.

Once you start paying for life insurance with your tax rebate, be diligent to continue it. Do some tax planning so that your next year’s tax rebate check is likely to contain enough to pay for next year’s premiums on your life insurance. Any money left over, is of course yours, to spend as you wish.

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Homebuyer’s Tax Credit Expanded for Previous Buyers

26. September 2009 · Write a comment · Categories: General Tax · Tags: , , , ,

Unlike the previous tax credit Congress passed in July of 2008 which provided up to ,000 to ONLY first time home buyers, the newly revised version also contains a provision for MOVE-UP or REPEAT home buyers as well.

Now, under the new provisions, home buyers that qualify as “long term residents”, or put simply, someone who has lived in the same house for at least five straight years in the last eight year period, is eligible for a tax credit of up to ,500 when they purchase a new or different primary residence. For married couples, BOTH must qualify as long term residents in order to take advantage of the tax credit.

This tax credit is limited to 10% of the home’s purchase price up to a maximum of ,500. Thus on a qualifying home priced at ,000 the buyer would receive a tax credit of ,000. Qualifying homes can be any of the following: a single-family residence, a town home or a condominium. Even mobile homes and houseboats qualify!

The tax credit is reduced for buyers with incomes above a certain amount. Single taxpayers who earn over 5,000 per year, and married taxpayers (filing jointly) who earn over 5,000 a year combined, will see a proportional reduction in the amount of the credit they can receive.

Repeat buyers have until April 30th 2010 to sign purchase agreements, and until June 30th 2010 to close on their new homes. Also, you can choose whether to apply your tax credit to 2009 or 2010 based on which choice would offer you a greater tax benefit.

Even though the tax code refers to qualified buyers as ”move-up” buyers, you don’t have to buy a house that is more expensive than your previous home to qualify. This means that even if you have sold a house for more than the one you are now buying, you can still take advantage of this tax credit! 

Consult with your tax professional to determine exactly how this new tax code may affect you.  You will need IRS form 5405 to determine the credit amount.  Also, make sure to include a copy of your HUD-1 settlement statement with your form 5405 as proof that you have already completed the purchase.

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Tips To Get Solar Tax Credit

24. September 2009 · Write a comment · Categories: General Tax · Tags: , ,

It is more familiar to see government and states creating budget to grow the solar energy market. Fortunately they also think to help homeowners willing to install solar panel.
The aids and solutions to go to solar exist since a long time. And the reason of why prefer solar panels is known by everyone. But there is still the same problem, the lack of info. And persons are not completely inform to act. In this article we will make an overview of different helps offered to the householders who decide to install solar panels. on top of that a lot of utility companies offer rebate programs to purchase your future excess of electricity production. So you will be assist for a long time after taking your decision.

The federal solar tax credit is maybe the most known. It’s completely normal because it’s a powerful solution fund by the government to spread solar panels into the maximum of home in United States. And it is the most generous incentives and it reduces your solar panel installation cost significantly. With this solar tax credit, the homeowners can reduce his cost by a reduction of 30% of his solar installation cost. But even for this help there is question about how to calculate it.

The solar tax credits have to be calculate on the cost of you installation afterward deducting all States and rebates provided by utility companies you can have. Let’s consider an good example, it will be more simplified.
John lives somewhere in United States and he is a homeowner and he decided to install solar panels. The total of the installation is 22,000$ . Following his localization, his utility company offers a rebate of 8,000$ . In this case we estimate the tax credit of 30 % on 14,000$ ( 22,000 $ -8000 $ ). Therefore John can get 4, 200 $ of the Federal tax credit. And So the final cost of the installation of John is 9,800 $ .

And if our John has more credit than he owes in tax, he can carry it over and uses it to defray next year’s federal tax bill during 8 years.

The documents you will need to fill to get the solar tax credit are available on the web site of the Department of Treasury IRS.

Now you know all you need about the IRS tax credit for solar panel installation. By having more information on the others incentives available in your State and provided by the utility companies you can save up to 50% on your solar investing. To complete with this article we are going to make a short overview of the others helps provided for householders. For good example in some States, there is rebate programs. And you receive money for every Watts you set up. In most of the case the householders can get around 2 $ per Watt installed. It is also a good thing when you know the common size of solar panel is around 4000 Watts. Other States propose to omit the amount of the solar system on the homeowner property tax.

So invest in solar is very attractive for homeowners with all incentives and tax credit, and there is no reason to private himself of all these helps.

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