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You May Be Able to Deduct Taxes Paid for A New Car

If you purchased a new car between February 17, 2009 and December 31, 2009, you may be able to deduct the state and local sales or excise taxes paid.  The deduction is available for the purchase of a new car, light truck, or motorcycle with a gross vehicle weight rating up to 8,500 pounds, as well as motor homes of any weight.  Taxpayers who purchased more than one vehicle can deduct taxes for all qualifying vehicles, subject to the price limit and phaseout rules.

The deduction is only available for taxes paid on purchases up to $49,500. If the purchase amount exceeds this, then only the amount of taxes paid on the first $49,500 can be deducted.  As usual there are income limitations and phase-out rules. For taxpayers whose modified adjusted gross income exceeds $125,000 ($250,000 for married taxpayers filing jointly) the deduction begins to phase out over a $10,000 range. There is no deduction available for taxpayers with a modified adjusted gross income exceeding $135,00 ($260,000 for married taxpayers filing jointly).

At HLB Gross Collins, P.C. we are committed to helping our clients minimize the tax bite each year by identifying all eligible deductions and planning opportunities. Contact your HLB Gross Collins, P.C. representative to assist you with your tax planning and preparation needs.

Georgia One of First States to Offer Rebate for Energy Efficient Appliances

Last year, many taxpayers took advantage of the Cash for Clunkers program which encouraged trade in of gas guzzlers for a new fuel-efficient vehicle. In a similar effort, also part part of the American Recovery and Reinvestment Act of 2009, Georgians can now earn rebates from $25 to $199 for the purchase of new energy efficient appliances.  Georgia is one of the first states to roll out this program which will continue until the money runs out. Nationwide, $300 million is available for this program which is allocated to each state based on population.  Georgia was allotted about $8.6 million to go toward this program.

Following is a summary of what appliances are eligible for the rebate and how much the corresponding rebate would be:

  • $30 for a qualifying room air conditioner
  • $50 for a refrigerator
  • $50-$99 for a washer, dishwasher or gas storage water heater, depending on the unit’s efficiency
  • $99 for a gas condensing water heater, central air conditioner or oil furnace
  • $199 for an electric heat pump water heater, gas tank-less water heater, solar water heater, air source heat pump, gas furnace, oil burner or gas boiler

Consumers can get only one rebate per appliance category, per household. The maximum rebate total per household is $1,200.

To apply for the rebate, go to www.GeorgiaRebate.com or call 866-296-1633. Many appliance retailers will also have information regarding the program and may be able to assist with the application.

Donate to Haiti by February 28 To Deduct on 2009 Return

As we previously reported, Congress passed  legislation making a special and temporary exception for Haiti relief.  Due to this legislation, taxpayers have the option to deduct qualified Haiti disaster relief contributions made after January 11 and before March 1, 2010 on their 2009 or 2010 federal return.  Donations made on or after March 1, 2010 will still be deductible when you file your 2010 tax return. However, if you would like to take advantage of the tax deduction on your 2009 return, be sure to make your qualified deduction prior to March 1, 2010.

To read more about how this planning opportunity, click here.

In Honor of Presidents’ Day, Timeless Thoughts From Thomas Jefferson

If you listen to the Gross Reality radio show, hosted by Steve Gross, then you know that the show is dedicated to helping businesses and individuals survive and prosper in good economic times and in bad economic times.  As the host, Steve brings in guest experts to discuss topics as they relate to businesses facing the challenges of the day.  Often, Steve concludes the weekly show with a thought-provoking idea shared by Thomas Jefferson, one of the most influential Founding Fathers and the principal author of the Declaration of Independence.  In honor of President’s Day, we’ve summarized some of the ideals shared by Thomas Jefferson:

Thomas Jefferson: “The spirit of resistance to government is so valuable on certain occasions that I wish it to be always kept alive. I’m a great believer in luck and I find the harder I work, the more I have of it.”

Thomas Jefferson : “The God who gave us life, gave us liberty at the same time.”

Thomas Jefferson: “I own that I am not a friend to a very energetic government.  It is always oppressive. It is incumbent on every generation to pay its own debts as it goes.  A principle which if acted on would save one-half the wars of the world”.

Thomas Jefferson“We may consider each generation as a distinct nation, with a right, by the will of its majority, to bind themselves, but none to bind the succeeding generation, more than the inhabitants of another country.”

Thomas Jefferson: “Our country is now taking so steady a course as to show by what road it will pass to destruction, to wit: by consolidation of power first, and then corruption, its necessary consequence.”

Thomas Jefferson: “The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.”

Thomas Jefferson : “When the people fear their government, there is tyranny; when the government fears the people, there is liberty.”

Thomas Jefferson: “A wise and frugal government, which shall leave men free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned – this is the sum of good government.”

Thomas Jefferson “The natural progress of things is for liberty to yield and government to gain ground.”

Snow Causing Drivers Problems in Georgia – But not for Teleworkers

While Georgia rarely sees snow and freezing temps, when the state does experience bad weather it can be difficult, if not impossible for many Georgians to get to work or school.  Because of the infrequency of these conditions, the state has limited equipment on hand to clear the roads. This year, many Georgians have already missed several days of work due to the mid-January snow and ice that left many Georgia roads impassible for several days. Now, with the threat of snow over the next few days, the possibility of bad driving conditions could mean more missed days of work.  However, for those who telecommute, this won’t be an issue. Aside from the tax credits they receive, they also get the benefit of being able to perform their work functions even in the event of a blizzard.

The idea of telecommuting is becoming more and more appealing to many employees. However, it can be hard for employees to convince their employer that this is an effective alternative to working at an office. Thanks to the Georgia Telework Tax Credit, employers now have added incentives to set up telework programs. Telework is defined as performance of normal and regular work functions on a workday that ordinarily would be performed at the employer’s principal place of business at a different location, thereby eliminating or substantially reducing the physical commute to and from that employer’s principal place of business.

In Georgia, this credit is available for tax years 2008 and 2009 as a nonrefundable credit available against the Georgia corporation income tax for a percentage of eligible “telework” expenses: up to $1,200 per employee and for 100% of the costs of an assessment of the employer’s telework program, up to a maximum credit of $20,000 per employer. The exact amount of the credit calculation will be determined based on factors including number of days per month the employee is working and whether or not the principal place of business is a nonattainment area (where air quality is poor or air pollution is high) as defined by the Environmental Protection Agency. Here is a general breakdown of the credit:

  • 100% of eligible expenses if the employee works at least 12 days per month and the primary place of business is a nonattainment area;
  • 75% of eligible expenses if the employee works at least 12 days per month, or;
  • 25% of eligible expenses if the employee works at least 5 days per month.
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