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You don't have to be a big contractor or government agency to get some benefit from the $787 billion stimulus plan. Individuals can get a piece of the action, too.
The American Recovery and Reinvestment Act contains a number of new or increased tax credits and deductions that the Internal Revenue Service allows taxpayers to take. And it's not just for homebuyers or people looking for cars.
The hitch is that many involve spending money.
A look at some of the benefits:
Retiree payments: People who are retired, disabled or receiving benefits from the Social Security Administration or the Department of Veterans Affairs will receive a one-time payment of $250.Railroad Retirement beneficiaries also are eligible for the payment, which is automatic and requires no tax filing, said Sheila Clark, director of operations for Peoples Income Tax based in Henrico County.
Tax-free jobless claims: The first $2,400 paid in unemployment benefits in 2009 will be tax-free. Virginia does not tax jobless benefits, but the federal government does, so this is a way save on those taxes, Clark said.
Reducing energy use: The energy tax credit for adding insulation or energy-efficient windows, heating or air-conditioning systems has increased to $1,500.
Alternative energy: Homeowners who pay for alternative energy systems -- solar hot-water heaters, wind turbines, geothermal heat pumps -- can get a tax credit of up to 30 percent of the cost of the purchased items, the IRS said.
Taking to the road: If you buy an electric car between Feb. 17 and the end of 2012, you can get a tax credit of up to 10 percent of the purchase price. Battery-charged twoor three-wheeled cars are also eligible. Certain battery-capacity restrictions apply.
Becoming electric: A tax credit of up to $4,000 (or 10 percent of the total cost) is available for motorists who convert a car so it can use plug-in electricity. The car must hit the road after Feb. 17 or the conversion must happen before the end of 2011.
Buying a car: If you bought a car after Feb. 16 or plan to buy one before the end of the year, you should be able to deduct state and local sales and excise taxes. Income and price guidelines apply. You will not need to file an itemized deduction to get this credit, the IRS said.
Buying a home: The tax credit for first-time homebuyers taking ownership of a home in 2009 is 10 percent of the price, up to $8,000. To free up money, the bill allows people to claim their home purchase in 2008 and file an amended return to get a refund. You cannot file an amended return until the sale closes, Clark said.
Contact Emily C. Dooley at (804) 649-6016 or edooley@timesdispatch.com.
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