Time Extended for First-time Homebuyers
Updated November 9, 2009
Looking to take advantage of the First-time Homebuyers Credit this year? The good news is that if you haven't found your perfect starter home yet, you still have some time to do so. A new law extends the time to buy to April 30, 2010. Also, if you enter into a binding contract to buy the home by that date you still qualify if the closing is before July 1, 2010.
A reduced credit up to $6,500 is available for long-time homeowners. These are homeowners who have lived in their homes at least 5 consecutive years out of the 8 years before buying and moving into a new principal residence. This new credit is for homes purchased after Nov. 6, 2009.
Get all the details:
An Overview of Home Ownership
Protect Your Documents
Posted June 25, 2009
It's hurricane season. In the event of a natural disaster affecting your home or business, the IRS offers the following recommendations:
- Create electronic backups of your records and store them offsite.
- Document your valuables with photo or video and store them with a friend or family member who lives outside the area.
- Update your emergency plans annually and when significant changes happen in your family or business.
- Employers using payroll services should make sure that their provider has a fiduciary bond that will protect the employer in the event of default by the
payroll service provider.
- Taxpayers in a federal disaster area qualifying for individual assistance can receive back copies of tax returns and all attachments, including W-2s,
as well as transcripts at no fee.
For more advice,
read our top 10 disaster tips.
Get a Tax Break on Your New Car
Updated July 31, 2009
No matter what state you live in, you can take advantage of a tax deduction for the purchase of a new motor vehicle.
The American Recovery and Reinvestment Act (ARRA) of 2009 offers taxpayers who buy a new motor vehicle in 2009 to deduct state or local
sales or excise taxes paid on the purchase. On June 10, the IRS and the Treasury Department said that a tax deduction is also available
in states that do not have a state sales tax.
Taxpayers in states without state sales tax may instead deduct other fees or taxes imposed by the state or local government. The fees
or taxes that qualify must be assessed on the purchase of the vehicle and must be based on the vehicle's sales price.
Also worth noting is that the IRS has formally stated that the deduction for state and local sales and excise tax paid on new
vehicles is available for multiple purchases of new cars, light trucks, motor homes and motorcycles. The $49,500 purchase limitation
is a per vehicle limitation, rather than an overall limitation on the deduction.
Save Money by Going Green at Home
Posted April 23, 2009
There are many new and expanded tax benefits on money spent to reduce energy use or create new energy sources. For example, homeowners can get bigger tax credits for making energy efficiency improvements or installing alternative energy equipment.
The American Recovery and Reinvestment Act (ARRA) of 2009 provides a uniform credit of 30% of the costs of qualifying improvements up to $1,500. Examples include adding insulation, energy-efficient exterior windows, and energy-efficient heating and air conditioning systems. It also raises the limit on the amount that can be claimed on improvements placed in service during 2009 and 2010 to $1,500.
The IRS provides a list of energy-related tax benefits in the ARRA in its
Fact Sheet 2009-10.
Tax Credit Phase-out Begins for Ford Hybrids
Posted April 20, 2009
The Alternative Motor Vehicle Credit for new hybrid automobiles manufactured by Ford Motor Company will be reduced in stages. A phase-out of the full tax credit begins after a manufacturer sells 60,000 hybrid automobiles.
For Ford vehicles purchased for use or lease from April 1, 2009, through Sept. 30, 2009, the credit is 50% of the full amount. On Oct. 1, 2009, the credit drops to 25%. No credits will be given for hybrid automobiles made by Ford beginning on April 1, 2010.
For more, see a list of all hybrid vehicles eligible for the tax credit.
Collecting Unemployment? The First $2,400 is Tax Free for 2009
Posted March 27, 2009
As of mid-March, a record 5.6 million people were receiving unemployment benefits. Those benefits are taxable. However, for those
drawing unemployment in 2009, the American Recovery and Reinvestment Act makes the first $2,400 of unemployment benefits exempt from tax.
For married couples, the tax exemption applies separately to each spouse. This means that if both you and your spouse claim unemployment
benefits this year, you can exclude the first $2,400 of your unemployment benefits and your spouse can exclude the first $2,400 of his or
her unemployment benefits received in 2009.
For unemployment benefits received beyond the first $2,400, which are subject to tax, unemployed workers can opt to have income tax
withheld from those benefit payments.
For further details about filling out a Form W-4V - Voluntary Withholding Request, read our article on unemployment.
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