The Federal Tax Credits Blog

Archive for September, 2008

Have you ever wondered how much some of your investments will be worth 10 years from now? How about 20 years? You can easily figure it out without using a financial calculator. Just use the Rule of 72.

Let’s say you invested $10,000 in a fixed annuity earning 6% a year. In 24 years, your assets will be worth about $40,000. How does it work? The Rule of 72: Divide the number 72 by the interest you earn, and it will give you the number of years it will take for your money to double. Using the above example, 72 divided by 6 equals 12 years for doubling. Since there are two doubling periods in 24 years, the original $10,000 would be worth $20,000 in 12 years, and $40,000 in 24 years.

Using this same Rule, an investment earning 8% would double in about 9 years, and a 12% investment would double in 6 years. You need to remember that a 6% interest rate in a Certificate of Deposit would not work as well as a 6% annuity.

A CD earning 6% would leave an investor approximately 4% after taxes. The Rule of 72 would only apply to an after-tax yield. A 6% annuity would be tax-deferred; therefore, the entire 6% would be counted. The Rule of 72 works best with fixed investments, or those with a fairly stable return. Also, it only works if you reinvest your assets. The Rule does not apply if you withdraw any funds. You can even use this Rule in reverse. For example, you are 38 years old, and you’d like to know how much you’d have to invest today to retire a millionaire. Using the same Rule (assuming a retirement age of 65, and an average annual return of 8%), here is how it would work:

Step One: 72 divided by 8% would signify that your money would double every 9 years.

Step 2: At age 65, you want your assets to be worth $1,000,000, so…

Step 3: You work in reverse, going back 9 years for every doubling period. $1,000,000 at age 65 (your goal) $500,000 at age 56 (9 years earlier) $250,000 at age 47, $125,000 at age 38 (lump sum)

If you invest $125,000 at 8% until age 65 (before taxes), you would have about $1,000,000 at retirement. This amount would change, of course, if you invested more than $125,000, or if the interest were higher, or better still, you started investing a little sooner than age 38.

Depending on your goals, and your age, you could retire earlier or later than age 65. You don’t have to invest a lump sum to retire comfortably. Just have a goal, and a systematic investment plan, and your retirement needs will be accomplished.

Selling Private Property in South Africa

The immediate and obvious benefit of selling your own property is that you will save thousands of Rands on payment of Agent’s commission. If you have a property for sale and are planning on selling it on your own without the help of an Agent or Middle Man it is not as difficult as many believe it is. There are Sites that give you the option to photograph your own property and advertise it …

As debt settlements, bankruptcies, and the unpopularity of credit card companying continue to increase, the Obama administration reiterated its support behind legislation in Congress that would put restrictions on the imposition of higher fees and interest rates on consumers. Following on promises made during his campaign, President Obama met with top brass from the largest credit card issuers in the country to push them toward action that would reduce abusive practices.

The meeting at the White House occurred as the House of Representatives worked to finalize new curbs on credit card fees. In addition to the curbs, senior White House officials pressed for a provision that forces require credit card companies to prioritize payments so that the first money to come in from a consumer is applied to debt carrying the highest interest rate.

In a separate action on Wednesday the House Financial Services committee passed a bill that would decrease and/or limit a variety of fees and penalties currently being charged by credit card companies. The bill was sponsored by Rep. Barney Frank, D-Mass., and Rep. Carolyn B. Maloney, D-N.Y

Most of the provisions, restrictions, and limits were already adopted by the Federal Reserve last year but there are also some new rules being dictated to the industry. The marketing of credit cards to minors would be prohibited. There are some new transparency rules for credit card companies requiring additional information for regulators. The last rule, and probably one that consumers going through debt settlement wish was in place a few years back, allows for credit cards holders to set lower credit limits than what the card issuers are offering. One specific benefit of the rule would be that parents could impose their own spending limits on credit cards they provide to their children.

The bill could reach the floor of the House where hopes are that it will fare better than a similar bill passed by the Senate Banking Committee three weeks ago. That bill barely passed with all Republicans on the committee in opposition. Pressed by credit card industry lobbyists, Senate Republicans will attempt to block that bill but public sentiment and pressure from the White House are likely to influence its passage.

Senate Republicans, industry executives, and lobbyists contend that passage of these bills is redundant due to the fact that the Federal Reserve has already adopted a series of similar restrictions that will go into effect next year. Another of the group’s contentions is that the passing of the legislation could further reduce lending in the face of tighter credit card company restrictions and the inability of consumers to obtain financing through other means. In reality, it could be that real agenda is to delay the inevitable to allow for fees and high rates addressed in the bill to be charged for as long as possible.

Question: I am donating clothes to a charity. What is the percentage of how much I will get back as a tax credit?

My mother recently passed away. I am gutting out the house she and I lived in. She had a ton of clothes. Between, the blouses, coats, shoes, pants, sweaters, dresses, and 3 piece ensembles the total value of what I come up with is a around $4200 and growing. Since I am donating it to charity, What is the precentage I will get as a tax credit of that $4200?
My attorney told me to itemize everything. Shoes, dresses, coats, outfits, blouses, pants, hats, etc. She told me to put a price tag on EVERY item. Which I did. $4200 might be high but I am just following my lawyers advice. My mother did not buy cheap when she was alive. Trust me, with all the clothes that I had to bag, it most likely in 50 years of buying clothes, would come out to over $100,000

Answer: There is no direct tax credit, but a deduction from taxable income. Read on.

If you now own the clothes, you get her basis in them.

The percentage depends on other things not mentioned in your question, i.e., do you usually itemize, how much is your income, how much is the donation, etc.

Broad outline:
When you donate to an 501(c)(3) IRS approved charity, they will almost always give you a receipt, usually blank (because, by law, they cannot estimate your value for you). You go into the store and see what comparable items sell there for. That is “thrift value.” It is much less than the value of the items when new.

Then you need to fill out Sch-A, and probably Form 8283, for non-cash charitable deduction. You will need to keep your receipt.

Then it is math. The math will turn out to be anywhere from zero to 35%, depending on your income, your other deductions.

With $4200 (which I think is probably high; you would need to donate more than $100,000 value of stuff when it was new) on Sch-A, with no other itemized deduction, it would be less than the standard deduction, so zero. If you had other deductible expenses, like mortgage, property taxes, state taxes, etc. it may raise it above standard deduction. That means you will get up to your marginal rate or less in deductions. There is no direct tax credit, but a deduction from taxable income. If you were at, say, the 28% tax rate, the most that would save you in taxes is 1176. It is math, and it can’t be estimated. If you were at the 10% tax rate, the most it would save you is $420.

Hollywood pizazz a bright spot for Pittsburgh jobs

In the past two years, hundreds of day players, technical workers and union drivers found steady work on movies filmed around Pittsburgh, where the state’s tax incentives program is expanding the entertainment industry.

Mark Udall Speech on the Water Accountability Tax Efficiency Reinvestment Act

Place: Noida, Date: March 19, 2009. Adore SoftPhone can be provide Private Labeled used to make outbound VOIP calls from any PC to any telephone, using the service provider’s gateway. It delivers SIP-based communications and services for PC-2-Phone, Phone-2-PC and PC-2-PC services.

Here is the detail products list for Client end Application :

For more information please visit us at : http://www.adoresoftphone.com

Adore SoftPhone is designed with latest SIP technology, NAT module (so it can operate through NAT and Packet firewalls). It uses Compression Voice Codecs and bandwidth control module.

Here is some of the features:

4 Lines
Hold / Unhold
Transfer (Xfer)
DND (Do not Disturb)

Call Conference
Redial
Mute
Auto accept call

Nat/ Firewall Support 

STUN server Support

ICE Support

Debug Mode (SIP message log)

Codec Supported
G711 u, G711 a, G722, GSM, PCMU/8000,
PCMA/8000, iLbc, Speex/ 8000, Speex/16000 ,

Speex / 32000 Codec selection and Codec Quality Control (Bandwidth control)

Silence Suppression

Echo Cancellation

Uses NEW RFC 3261 compliant stack DTMF (RFC 2833) RFC 3951:
Internet Low Bit Rate Codec (iLBC) Proxy Settings Registration Timeout
Acoustic Echo Cancellation.
Packet concealing
Packet Lost Concealment (PLC).
Comfort Noise Generator (CNG),
Resampling
Balance Display
Credit time display

Basic Features:
Customized skin interfaces
Call timer
Last Number Redial
Touch Tone
Address Book
Micro Phone Volume Control
Speaker Volume Control
Work with any full-duplex sound card
Auto-configuration of settings for easy deployment

For more Information about our Softphone and Web2Phone, Please visit : http://www.adoresoftphone.com

ABOUT Adore Infotech

Adore Infotech is a Complete VoIP software product and solution providers. Founded in the year of 1994. In this short time we are dealing it’s software with over 500 clients in over 25 countries and counting.

Below you can contact to Adore Infotech

Energy costs are on everyone’s mind, and alternatives are a hot property – though many homebuyers aren’t sure how to find and evaluate them. There are a number of technologies to choose from which can help make your next house the home of the future.

Alternative energy gives new meaning to the real estate mantra of – what works in sunny California may be different from what works on the windy plains. But just as there are many styles of homes for buyers’ diverse tastes, there are varied options in energy systems with more than one sometimes working hand-in-hand for the same house.

Wind power – an ancient energy source now seen in high-tech “windmill farms” with tall propeller-like turbines – has come down in the cost for generating electricity by over 80 percent since 1981. Geothermal energy – home heating powered by underground steam warmed up by the temperature of the earth itself – is a source getting more attention in the American West.

Relocating homeowners can choose to move to areas where wind generation is lowering electricity costs, while geothermal energy has applications for both large-scale power plants and individual homes. There has also been progress in residential settings with fuel cells, power systems that convert natural gas fuel to electricity through a chemical reaction with hydrogen, producing just water as a byproduct.

Perhaps the most familiar and popular source of renewable alternative energy remains the sun itself. Photovoltaic (PV) systems, which convert sunlight to electricity, have shown great energy-bill savings and homeowner satisfaction. These systems, which have been likened to a car that makes its own gas, are now available in the form of roof tiles that can integrate attractively with regular roofing.

Households that use roof tiles have found some 80 percent of their electricity needs supplied by them The homes can remain on the conventional power grid for the rest; at sunnier times when the home produces more energy than it can use, it goes back into the grid and credits the homeowners’ account, literally turning back their electric meter. Across the country rebates from utility companies and tax credits from government are available for such setups. It’s a way of contributing not only to the global community by using up less nonrenewable energy, but also to your own neighbors by freeing up conventional power.

Solar tiles are growing in popularity with home-development builders, and are seen as paying for themselves in savings and simplicity of maintenance. The savings increase considerably in combination with energy-efficient appliances. For example, in Sylmar, California’s Village Green complex, this mix is a standard feature and the average resident has been shown to pay one-tenth in monthly utility bills what other town residents pay.

Your local real estate professional can help advise you on what energy alternatives are most available and may work best in your area. A little shopping around may shed light on options that make yesterday’s technological dreams today’s homeowner dream-come-true.

Real Estate

Seize tax incentives now for green improvements to housing and commercial properties.

Rep. Doggett on Renewable Energy Tax Extenders