I think at this point we are all looking for ways to save every dime we can. One important thing to remember is that we can realize excellent savings opportunities during tax time. Two big issues that people have in this regard are that 1) they do not know the opportunities available and 2) they do not bother taking the time to learn about and use them. I came upon this article from CNN that lists five new tax breaks that have come about from the American Recovery and Reinvestment Act, aka stimulus bill. The basic idea is that the more tax breaks we achieve the more money we have to dump back into the economy.

First time homebuyers were able to receive an $8,000 tax credit if they purchased a new home in 2009. This law has been expanded and now new homebuyers have the chance to get the credit if the home is purchased through April 10th, 2010. They have also extended this credit to “almost” new homebuyers. Those who have had a home for five years or less can receive a $6,500 credit if they purchase a new home by the April 10th deadline.

The IRS is offering the American Opportunity credit for college and graduate students’ tuition and can be claimed for 2009 or 2010. “If you're a student and your income is $80,000 or less, you can qualify for a credit of up to $2,500 a year, an increase of $700 from the previous Hope Credit”, according to the article.

The government is also expanding opportunities to those homeowners that make an effort to go green with energy-efficient upgrades. The new law allows taxpayers to claim up to 30% of these costs. The law mainly pertain to heating and cooling so you may want to do a little more research on what is and is not included. Check out this link for more information: http://www.energystar.gov/.

If you are currently working, the Making Work Pay credit provides a refundable tax credit for married couples. This credit may have already been deducted from your pay because of federal income tax adjustments but people will still need to claim the credit. As stated in the article, “the Tax Policy Center estimates that 75% of all taxpayers filing their returns this year will benefit from the credit and see a savings of $375 on average, said Roberton Williams, a senior fellow at the Tax Policy Center”. Be careful though of stipulations associated with this particular credit, some may end up owing.

The last credit mentioned in the article relates to new car buyers. Those applicable will have the opportunity to claim deductions on state and local taxes from new car purchases from February 17, 2009 through the end of the 2009 calendar year. This credit should be fairly widespread and those who participated in the Cash for Clunkers program will certainly see the benefits.

So, don’t give up just yet, there are chances for everyone to get some of their hard earned money back from the government. Well….some anyway!
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Jennifer Ulrich

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  1. Unfortunately the creator of these tax breaks overlooks the largest and qickly growing group of people- the retired population - on limited income. For example-we are still paying for scool taxes and our property taxes are continuing to increase.

  2. Are we fogetting that the taxes that we pay our from "our" money. Uncle Sam is just returning what we had to begin with. It is all a shell game. You pay me, I'll return it to you, and than just pay me back again.