Tax Changes That Could Boost Your Return
WASHINGTON (TheStreet) -- As taxpayers work on their 2009 returns, a number of new and increased deductions may make the process a little more bearable. Here are some tax changes that could impact what you owe or get back this year:
Environmentally conscious folks will want to make sure they have a copy of the Internal Revenue Service's Form 5695 in hand when they crunch out their taxes. The costs of several "green" efforts can be deducted this year as part of the government's plan to stimulate the economy. Homeowners who install energy efficient windows, doors, furnaces, central air conditioners and water pumps can receive up to a 30% tax credit (capped at $1,500).
Alternative energy technology can also earn tax credits, starting this year and through 2016. Up to 30% of the cost of solar water heaters and panels, wind energy and geothermal heat pumps is deductible. Numerous energy-efficient appliances are also eligible for a range of tax rebates.Hitting the books The American Opportunity Credit, available for 2009 and 2010 tax filings, allows people to deduct education expenses such as tuition, fees and books. The credit reimburses the first $2,000 spent and 25% of the next $2,000 for taxpayers whose modified adjusted gross income is $80,000 or less ($160,000 for joint filers). The tax benefit scales back as the filer's income rises above the threshold. The credit is reduced or eliminated for taxpayers with incomes above these levels and is only available during the first four years of college.
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