October 15. The final deadline for folks who got an extension to file their 2006 tax returns.
October 15. The inaugural Blog Action Day, when bloggers unite to discuss environmental issues.
Coincidence? I think not.
Over the past few years, the U.S. tax code has become more environmentally friendly.
Before you send in your return today, check it over to make sure you don't miss out on these savings.
And even if you filed months ago, bookmark this item. You can take advantage of most of them on your 2007 return, too.
Home Energy Efficiency Improvement tax credits: Purchase and install specific products, such as energy-efficient windows, insulation, doors, roofs and heating and cooling equipment in the home and you'll be eligible for a tax credit of up to $500. Heck, even something as simple as adding window film can qualify.
This new law, which took effect Jan. 1, 2006, also provides a more substantial tax break -- up to $2,000 -- for qualified photovoltaic, fuel cell and solar water heating systems installed in your home.
While the bulk of the energy efficient upgrades must be made by this Dec. 31 to get you a credit on our 2007 return, there is talk that the tax break might be extended. The solar component already has been given a longer life. On Dec. 20, 2006, the Tax Relief and Health Care Act of 2006 became law and included a one-year extension (through Dec. 31, 2008) for certain existing tax incentives including installation of solar equipment in homes and businesses.
Details on the home energy efficiency tax credits can be found at this Energy Star Web page.
Driving home tax breaks: Did you buy or plan to buy a new IRS-certified hybrid car, truck or SUV? Then you'll get, depending on the vehicle and when you bought it, a tax credit of $250 to $3,400. There is a similar credit for alternative-fuel and fuel-cell vehicles.
If your hybrid of choice is a Toyota or Lexus and you bought it by Sept. 30, you'll get some credit on your 2007 tax return. But on Oct. 1, the tax credit for the Japanese auto maker's popular fuel-efficient vehicles was eliminated. I've rehashed the crazy political reasons why in my previous hybrid postings.
Full details on eligible autos and their credit amounts are at this IRS Web page. Also check out the Fuel Efficient Vehicle Tax Incentives Information Center.
Gifts to environmental groups: If your favorite environmental organization is on the IRS list of registered nonprofits (check Publication 78 or GuideStar), then any donation you make to it can be deducted on your tax return if you itemize.
Some states allow you to make donations to charities, including many with an eco focus, directly on your state income tax return via check-off boxes.
Eco investments yield tax breaks: More folks today are earning green by green investing.
A large component of ecological investing is buying stocks of or mutual funds that include "green" companies, i.e., businesses with an environmental focus, such as conservation programs or organic food manufacturers or retailers.
But eco investing also can include buying stock of companies that don't have a direct environmental connection, but which have taken steps to be more environmentally friendly in their operations, such as converting their offices to solar power. And some investment managers even buy into "dirty" companies (for example, big oil) if they are making a concerted effort to literally clean up their acts.
As with all investments, you need to do your homework and find an eco-friendly fund that meshes with your personal philosophies and financial goals.
But regardless of the investment focus, the tax treatment is the same. If you sell an asset that you hold for more than a year, then you'll pay lower capital gains tax rates on the profit.
More final filing tips: If you're a master tax procrastinator who's still working on your tax return, you also might want to check out this earlier post for some additional filing tips.
Please check out the posts of my eco-blogging colleagues today. We appreciate your support of our united effort.