Solutions To The America’s Hard Economic Time

Tax Act

With $1.3 trillion deficit decline in State’s Revenue, and 43 States faced with budget deficit, these proves that the United States of America is not left out in this hard economic time. As a solution to the situation, 2012 taxes, tax cuts was enacted.  Unfortunately, it was tricky hence; the US resorted to slashing programs and lowering costs. Worse still, it led to increase of some taxes but still a total of eight-tax cut set forth.

2012 taxes, tax cuts stands out as a major challenge. Brooking reports show that 40 States raised taxes and consequently spending declined. Previously, taxes increased by nearly $24, translating to a cool 3.5% increase. 2012 taxes, tax cuts therefore look slightly effective in the struggle to shrink the State’s deficits. Large States like New York and California, recorded a bulk of tax increase.

Among the six States that raised taxes the most, five of them slashed services in various sectors namely public health, higher education, State workforce, early education and K-12 and the elderly or disabled. This is a clear indication that 2012 taxes, tax cuts is close to impossible or else the country suffers a decline. Two states also slashed their services in four of these sectors while the other two scrapped off funding for all the five sectors.

Interestingly though, the States with the highest tax raise still had some of the most generous programs for the residents instead 2012 taxes, tax cuts.

In the 2008 fiscal year, out of the six States, four of them spent over $4,600. This exceeded the national average of $4,114 per individual.

What is the Federal Residential Renewable Tax Energy Credit?

Tax Act

If you have made renewable energy improvements to your home, or you are considering them, you should know about the Federal Residential Renewable Energy Tax Credit. The Federal Residential Renewable Energy Tax Credit is a program that gives a huge tax incentive to people who install solar-electric systems, solar water heaters, geo-thermal heat systems, fuel cells and/or wind turbines. If you have installed a renewable energy system, or you are planning to install one, the tax credit can help you recoup a large portion of your initial investment.

A Brief History

The Energy Policy Act of 2005 was the first act to establish tax credit for residential renewable energy installations. The Energy Improvement and Extension Act of 2008 and The American Recovery and Reinvestment Act of 2009 further strengthened and extended the original act. As of this writing, the tax credit is available until 2016, although there is a good possibility that this deadline will be extended as it has in the past.

Who Is Eligible?

If you have a solar-electrical system, solar water heater, geo-thermal heat system or wind turbines that were installed after 12/31/2008 then you are eligible for a 30% tax credit with no maximum amount. If you had your system installed before 1/1/2009, then there is a maximum credit of $2,000. In the case of wind turbines installed before 1/1/2009, the maximum credit is $4,000. Additionally fuel cells need to have been installed after January 1, 2006 and the maximum credit is $500 per half kilowatt. There are certain federal Energy Star requirements for renewable energy systems, so if you are planning an installation, then you should consult with a professional about which systems are eligible to receive the tax credit. If you already have a renewable energy system installed, you should consult with a tax account to find out if you can still claim the credit.

Other Caveats

The home or homes served by the solar panal installation system do not have to be the taxpayer‘s primary residence, except in the case of fuel cells, where only the taxpayer‘s primary residence is eligible. For solar water-heating systems, the Solar Rating Certification Corporation (SRCC) or a comparable state agency must certify the system for performance. Additionally, the solar water-heating system must heat at least 50% of the home’s water. Hot tubs and swimming pools with solar water heat are ineligible for the tax credit. Fuel cells must generate at least .5 kilowatts and have electricity generation efficiency greater than 30%.

Although determining your eligibility may seems confusing, it is actually not that difficult. Most renewable energy systems installed after 12/31/2008 are eligible. However, you should check with the IRS or with a tax accountant if you are not certain. If you are planning on installing a new renewable energy system, than you should definitely consult with the company doing the installation to make sure that you get a system that will get you the tax credit so that you can offset your initial investment.

About the Author: Odette Maupredi has spent months researching residential solar panel benefits and highly recommends everyhomeowner look into both state and federal energy programs. You could stand to save quite a bit of money if you can afford to participate.

Tax Changes in the American Recovery and Reinvestment Act

Tax Act

Tax Changes in the American Recovery and Reinvestment Act

A number of tax law changes were made in the recently passed and signed American Recovery and Reinvestment Act also know as the Federal Stimulus Bill. Those changes include Income Tax reductions, Unemployment taxes, Cobra Health Insurance subsidies, and number of other important changes.

Income Tax Reduction

Individuals and couples will get a $400 income tax reduction through their payroll per person for the 2009 and 2010 tax years. The reduction phases out for individuals that make more than $75,000 or couples earning over $150,000 a year.

Unemployment Tax

Those … Read more at 2009 Taxes

Tax Act

Tax Changes in the American Recovery and Reinvestment Act

A number of tax law changes were made in the recently passed and signed American Recovery and Reinvestment Act also know as the Federal Stimulus Bill. Those changes include Income Tax reductions, Unemployment taxes, Cobra Health Insurance subsidies, and number of other important changes.

Income Tax Reduction

Individuals and couples will get a $400 income tax reduction through their payroll per person for the 2009 and 2010 tax years. The reduction phases out for individuals that make more than $75,000 or couples earning over $150,000 a year.

Unemployment Tax

Those receiving unemployment due to job loss would normally need to pay tax on the income. But under the American Recovery and Reinvestment Act, all unemployment payments will be tax free.

Health Insurance Coverage

Under Cobra, laid off workers can continue to be covered under their prior employer’s health plan, but they have to pay the premiums themselves which are often quite a bit more than an self insured person would pay. Under the new law, the US Government will now pay 65% of all Cobra premiums for unemployed workers.