It’s usually at the end of the year that you’ll notice lots and lots of articles offering money savings tips. But with the New Year only four months away, putting your tax planning hat on now is a smart financial move as well as a good investment of your time. Similar to investment planning, tax planning is pro-active and has the potential to lower your overall tax bill.
The tax code is changing constantly and keeping up with the latest tax deduction credits is not a hobby most American’s embrace. Yet, when you realize one of the largest deductions on your paycheck is usually Federal or State Income taxes, paying attention to these changes takes on new importance.
Residential Energy Efficient Tax Credit
This green tax credit has been around since 2006 and will expire at the end of 2016. If you’ve been thinking about making some changes to your home energy systems, now might be a good time to make a move. The tax credit is equal to 30% of the cost of the following:
- Solar hot water heaters
- Qualified solar electricity property
- Fuel cell property
- Residential wind property
- Geothermal heat pumps
If you’re thinking about buying a new car and interested in a Hybrid, you’re in luck as long as you make your purchase prior to December 31, 2010. Hybrids purchased or placed into service may be eligible for a federal income tax credit of up to $3,400. Here’s a link for more info: fueleconomy.gov. If electric or alternative fuel cars tickle your fancy, here’s another link loaded with good info that can help you make a decision: energy.gov
Save the planet and at the same time save on your taxes-now that’s a plan. Any other ideas or tips, please send them my way.