How families making $75,000 can get hit with AMT

There was a very good article on the AMT tax this morning on CNN Money’s website. 

It basically talks about how the AMT is supposed to keep the rich from paying too little tax, but since the AMT rules have never been adjusted, it’s middle income Americans who are facing the AMT. 

I agree that the AMT needs to be fixed, as more and more of my middle income clients become subject to the AMT every year.

Click here to read more.

=> Tax Tips for WAHMs – free ecourse

Tags: AMT, alternative minimum tax

Don’t forget the Energy Tax Credits

Just a quick reminder…

If you made improvements to your home in 2006, you may be eligible for one of the Energy Tax Credits.

Improvements such as adding insulation, replacement windows and energy efficient furnaces and air conditioning units all qualify.

The credit ranges from $50 to $500 depending on which improvements you made and how energy efficient the improvements are.

To qualify for the credit, you will need to keep your receipt and you should also have a manufacturer’s certification statement that shows the specifications of the product.

For more details about the credits available and the requirements please visit: http://www.energystar.gov/index.cfm?c=products.pr_tax_credits#s1

I’ve been tagged…

by Arika at Mom’s Gone Virtual’s Telecommuting Taxes. 

The question she asks is ‘why do I blog’?  One of the main reasons I blog is to organize my thoughts.  I get a lot of tax and personal finance questions and a blog is a great way to answer those questions for clients (and others), and to organize those answers.

I created the Financial Tips for WAHMs blog because wahms have unique tax and personal finance challenges. 

I wanted wahms to have a place to go to get answers to questions like how to save for college, taxes for wahms, saving money for retirement, etc.

Coping with market fluctuations

You’re probably aware that the stock market fell 400 points last week.  How did you handle the drop?  Did you panic and sell, or did you hold tight?

Market cycles are normal and should be expected.  You shouldn’t allow your emotions to influence your investing decisions.  Remember these important points when making investment decisions:

Diversify to reduce risk.  Spread your investments among various asset classes (stocks, bonds, cash) based on your goals, time frame and risk tolerance.  If your portfolio is properly diversified, a decline in one asset type will be balanced out by a gain in another asset type.

Deducting home office expenses for your home based business

Most WAHMs operate from their home.  One of your biggest tax deductions may be your home office, so it’s important to learn what expenses you can deduct.

If your home office qualifies, you may be able to deduct part of your housing expenses on your tax return.  Your home office qualifies if it is your principal place of business, and you use it regularly and exclusively for business.

To pass the ‘place of business’ test, your home office must be the principal place you conduct your business, or a place where you regularly meet clients or customers, or it must be a separate structure not attached to your home.  If you store inventory for your home-based business, that may also qualify you for the home office deduction.