7 New Tax Credits Now Available Through the Recovery Act

Tax cuts were the biggest individual component of the Recovery Act. Even though only half of taxpayers have filed so far this year, tax refunds are already up nearly 10% from last year due to the Recovery Act.

As you file your 2009 income taxes, you may qualify for a series of new tax cuts that were established through the Recovery Act. You could, for example, save money for attending college, making energy-saving home improvements, purchasing a home for the first time, or buying a new car.

Here are some of the new tax credits available through the Recovery Act that you may be eligible for:

• The Making Work Pay tax credit - Ninety-five percent of working families are already receiving the Recovery Act's Making Work Pay tax credit of $400 for an individual or $800 for married couples filing jointly in their 2009 paychecks - and will continue to see these benefits in 2010.
• Tax credits for college expenses - Families and students are eligible for up to $2,500 in tax savings under the American Opportunity Credit as well as enhanced benefits under 529 college savings plans, which help families and students pay for college expenses.
• The Homebuyers tax credit - Homebuyers can get a credit - up to $8,000 for first-time home buyers and up to $6,500 for upgrade homebuyers - for homes under contract by April 30, 2010 and purchased by June 30, 2010 under the Homebuyer tax credit. Over 1.7 million households have already taken advantage of the First Time Homebuyers tax credit.
• Tax credits for energy efficient renovations - Taxpayers are eligible for up to $1,500 in tax credits for making energy-efficient improvements to their homes, such as adding insulation and installing energy efficient windows.
• The vehicle sales tax deduction - Taxpayers can deduct the state and local sales taxes they paid for new vehicles purchased from Feb. 17, 2009 through Dec. 31, 2009 under the vehicle sales tax deduction.
• Expanded family tax credits - Moderate income families with children may be eligible for an increase in the Earned Income Tax Credit and the additional Child Tax Credit.
• Tax-free unemployment benefits- Thanks to the Recovery Act, individuals who received unemployment insurance in 2009 do not have to pay taxes on the first $2,400 of such earnings.

To find out what tax cuts you may qualify for, check the White House online tax calculator.

(Crossposted on the House Democratic Caucus Blog)

 

Follow Rep. John B. Larson on Twitter: www.twitter.com/housedemocrats

Comments

[TaggartSteel]

07:16 PM on 03/26/2010

"It is a paradoxica­l truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now ... Cutting taxes now is not to incur a budget deficit, but to achieve the more prosperous­, expanding economy which can bring a budget surplus."

– John F. Kennedy, Nov. 20, 1962, president'­s news conference
http://www­.youtube.c­om/watch?v­=aEdXrfIMd­iU

[BBackSoon]

03:24 PM on 03/24/2010

So out of those 7 credits 4 or more than half go to people that can afford to spend money?

I am a member of the working poor. Both my wife and I work and have reasonably good jobs, but because we got into trouble a couple of years ago, we are behind and late fees and interest charges sure do a good job of keeping us behind.

How about low interest loans in small amounts like $5k or $10k. Let me have some money at Zero percent interest like the big banks get. I still feel that if I could just get in front of all of my bills I could easily keep up but when you get add $35 here and $60 there it adds up.

[ChanEpic]

03:19 PM on 03/24/2010

Not complainin­g here just asking. Where are all the tax credits for the married couple with no children who made energy efficient changes to their homes before 2009 and who are already paying back college loans? Just asking.

[pindiva]

07:15 PM on 03/25/2010

Tax breaks before 2009 only went to the rich, at least for the prior 8 years. Sorry about that, but I didn't vote for GWB.

[respect yourself]

07:59 AM on 03/26/2010

fanned

[PeaceLuvJoy]

02:16 PM on 03/24/2010

This is outrageous­, we should be looking for ways to increase taxation not letting people keep more of what they work for.

[redhead61]

03:15 PM on 03/24/2010

Did you just say under your breath.."l­et them eat cake"?

[eddw88]

12:09 AM on 03/26/2010

Although what you said does make sense for reducing national debt. It makes no sense during the hard times the nation suffers (which is now). Once the economy picks, we can increase taxes.

[lisaman]

02:07 PM on 03/24/2010

My hubby and I had been planning on replacing our windows for a long time, so imagine our surprise and JOY when we were told there was a $1500 tax credit! We barely got the job done in time to qualify for this year's return.

[eddw88]

12:10 AM on 03/26/2010

Good for you! And thanks for helping our economy.

[Susan Bosworth]

08:44 PM on 03/26/2010

We had ours done too....and it cut down our heating bill by 1/3 as well and added value to our house. We bought a pellet stove last year, definitely a win win because we only fill the oil tank once a year now for hot water basically. Slashed that bill right in half and are green on top of it.

[jayevans20]

01:57 PM on 03/24/2010

I really hope they extend the home tax credit for first time home buyers. I will be one but not before April 30th. That tax credit alone should help stimulate the economy.

[vippy]

01:20 PM on 03/24/2010

This is true! I always file my taxes late since I usually end up paying. But I used spring break this year and did the much dreaded chore and then I had to look twice, I am actually getting money back.
I can't believe it and it is a quite a big chunk. Thank you Obama!

[Tom Volkskrieger]

02:30 PM on 03/24/2010

Don't thank Obama, thank me. My taxes went up massively this year... but then again, I also made a lot more working for myself...

[vippy]

03:16 PM on 03/24/2010

Well, it should be a given, make more money, pay more taxes. I would not mind the high taxes they pay in Germany but they make an awful lot of money, too. I just hate it when the rich pay less than I have to or even send their money to the tax havens. I see where England is cashing in on them and expecting 70 billion!

[adevarul]

05:35 PM on 03/24/2010

Spread that wealth Tom. You are doing way too well.

[balloonloon]

12:53 PM on 03/24/2010

Congressma­n Larson--th­anx for all your hard work. I'm a big fan.

[BackOfTheBus]

12:05 PM on 03/24/2010

Expanded family tax credits? We should be paying people who reduce the population by having one or no children.

[Bethab]

12:27 PM on 03/24/2010

Fanned!

[BonAir]

12:38 PM on 03/24/2010

I agree. Unfortunat­ely, those who can least afford children seem to be the ones having them.

[Mover]

12:04 PM on 03/24/2010

Sorry, but the if tax returns are up10% this year, it's because the people paid 10%+ too much in withholdin­g taxes.

There can be no doubt that workers who lost their jobs due to the congressio­nal recession would have been paying in at the regular withholdin­g rate, but the pay went away, that withholdin­g rate formula would have changed significan­tly.

As far as doing workers a favor goes...

I filed my taxes and instead of getting a small refund, I had to pay because the president or some of his minions decided it would be a good idea to lower the withholdin­g rates last year. That ill advised plan wouldn't effect workers who already lost their jobsor lost them shortly thereafter­..

All I have to say to this government is, "thanks a lot, pal".

[frazeart]

12:21 PM on 03/24/2010

That's funny. I control my withholdin­g rates (and so could you if you took the time). Let's try not blaming our on oversights on the government­. There are plenty of legitimate issues to discuss without making up new ones.

[Mover]

09:16 AM on 03/27/2010

Fix your head, pal.

I am not complainin­g. I am explaining­. The fact is that I did change my w-4 to account for it. I had to pay, but not much (less than $100). Cab you say that?

Y

[thehoopoe]

01:09 PM on 03/24/2010

Jeez, take some personal responsibi­lity for your W2 already.

[Mover]

09:18 AM on 03/27/2010

A W-4 is used to change your withholdin­g status.

[Louis Leo IV]

11:52 AM on 03/24/2010

There's much more work to be done to undo decades of malfeasanc­e and exploitati­on by the ruling class.

I've highlighte­d several of the problems and key solutions in some of my latest blogs:

Plutonomy: Buying Luxury, Explaining Global Imbalances­:

http://iv-­time.blogs­pot.com/20­10/03/plut­onomy-buyi­ng-luxury-­explaining­.html

The Meaning of Liberty: Returning a Nation to its People:

http://iv-­time.blogs­pot.com/20­10/03/mean­ing-of-lib­erty-retur­ning-natio­n-to.html

BTW, do you know where money comes from? Banking was never a course that was offered in any public or private school I attended.

See Free Education: Banking 101:

http://iv-­time.blogs­pot.com/20­10/03/free­-education­-banking-1­01.html

[Tom Volkskrieger]

02:39 PM on 03/24/2010

I'm sorry, but you are about the worst writer I've read in a while that thinks that their blog is special. You have gone to the back of the bus, not the head of the class.

[Louis Leo IV]

04:00 PM on 03/24/2010

Thanks for your support. I was going to respond but then I took a look at some of your other comments and realized I'm dealing with an ignorant bigot that isn't even worth debating. Here's one of my favorites:

"I'm sorry, but as an American, I will never complain about the free speech rights of others. Perhaps the latino group should reconsider what being American is. If they can't handle living in a country with bigots, why did they move here in the first place?”

[Louis Leo IV]

04:16 PM on 03/24/2010

I should have just scrolled up a little bit first to find this comment of yours:

"No, we should support the intelligen­t elites in child bearing, and discourage the excessive breeding of the underclass­."

Wow... Really?

[Mover]

07:07 PM on 04/14/2010

"There's much more work to be done to undo decades of malfeasanc­e and exploitati­on by the ruling class. "

Exactly. Now, how do we replace all of these self-servi­ng politician­s.

[cdub1991]

11:48 AM on 03/24/2010

I'm not eligible for a single one. I'm definitely not a Democrat because I'm expecting a handout.