MONEY

FINANCIAL

PLEASE FEEL FREE TO:

Post a Comment or sign our Guestbook

TAKE ADVANTAGE OF THE NEW TAX LAWS

Buy a home. If you're a first-time buyer, check out the tax credit available through Nov. 2009, which is worth 10 percent of the purchase price, or up to $8,000. Conditions you should know about: You cannot have owned a home in the past three years and your combined annual income as a married couple cannot exceed $170,000, or $95,000 if you are single. If you've already made a qualifying purchase, you can amend your 2008 tax return to get the cash now, without waiting for your 2009 filing.

Refinance a mortgage. The administration's new foreclosure-prevention plan allows homeowners who are mortgaged for as much as 105 percent of their home's value to refinance and lower their payments. If you think you might qualify, call your lender and talk to customer service. Qualifying loans will be owned or guaranteed by Fannie Mae or Freddie Mac. Just keep in mind that, to qualify, your current payments must be up to date.

Buy a new car. The stimulus plan will get you a sales tax deduction when you buy a new car, as long as the price is less than $49,500, you bought it on or after Feb. 17, 2009, and your gross income is under $135,000 if you are single or $260,000 for a married couple.

Get green. Installing energy-efficient windows in 2009 or 2010 may qualify you for a nice tax deduction of up to 30 percent of the purchase price. Ditto for solar and wind energy improvements. You can visit energystar.gov to see which projects and products qualify for the credit. With any luck, you've made improvements already that qualify. That means all that remains is picking up the dough.

Pay for college. The Hope Scholarship Credit was replaced with the beefier American Opportunity Credit. Claim this new stimulus item and you should get back 100 percent of the first $2,000, plus 25 percent of the next $2,000, spent on tuition, books, fees and other costs for college, trade school or university education, provided the student attends at least half-time. To learn more about this credit plus other opportunities, visit ed.gov.

Modify a mortgage. Families struggling with mortgage payments may qualify for loan modifications if their payments (including taxes and homeowners' insurance) are greater than 31 percent of their monthly pretax incomes. The government anticipates some households could save more than $400 per month. Visit makinghomeaffordable.gov or call 888-995-4673 to see if you qualify.

From Mary Hunt -Debt Proof Living