Summer Tax Tips

It's that time of the year where the hustle and bustle slows down and we can finally take a moment to enjoy what we have worked so hard for all year long. It's also the time of the year that some of your tax planning may slide, so here are some fun Summer Tax Tips to keep in mind while you work and play.

Summer Camp
Is your child enrolled in a Summer Day Camp? You may be eligible for a tax credit. Many working parents must arrange for summer care for children 13 years and younger. Unlike overnight camps, the cost of day camp may count as an expense toward the Child and Dependent Care Credit.

Summer Cleaning
Summer Cleaning could earn you a tax deduction, as long as you donate items in good condition to a qualified charity. Remember to itemize your deductions and keep proof of all of your donations.

Summer Home
Buying a home this summer? First time home buyers get a credit of up to $8,000 (first time home buyers are those that haven't owned a house in the past 3 years). This credit is good for houses purchased prior to December 1st, 2009.

Summer Job
Any working students at home for the summer? Some things to keep in mind are what status they are employed as and if they will be exempt from withholding. Summer workers are sometimes misclassified as independent contractors (self-employed) rather than as employees. Employers who do this usually fail to withhold taxes from the worker's wages, often leaving the worker responsible at tax time for paying income taxes plus Social Security and Medicare taxes. Pay close attention to this so there are no surprises come tax time. Your working students also may be exempt from withholding if they are claimed as a dependent, their total 2009 income is not over $5,700, or they had no income tax owed for 2008. Feel free to call us at MB Tax Professionals with any tax questions for your working student.

Summer Road Trips
Buying a more fuel efficient car just in time for those long summer road trips? You may be eligible for a tax credit up to $1,800 depending on the make and model just for changing what you drive.

Enjoy your summer and let us know how we can help make 2009 your smoothest tax year yet. Looking forward to working with you soon!

2009 Hybrid Vehicle Federal Tax Credit

Hybrid Vehicle Tax Credits are often misrepresented at the dealership. Be informed and check the IRS website or call your tax professional before making any purchase. There are a limited number of each model that qualify so make sure your new car is one of them.

A tax credit is subtracted directly from the total amount of federal tax owed, thus reducing or even eliminating the taxpayer’s tax obligation. The tax credit for hybrid vehicles applies to vehicles purchased or placed in service on or after January 1, 2006.

The credit is only available to the original purchaser of a new, qualifying vehicle. If a qualifying vehicle is leased to a consumer, the leasing company may claim the credit.

Hybrid vehicles have drive trains powered by both an internal combustion engine and a rechargeable battery. Many currently available hybrid vehicles may qualify for the tax credit.
These models have been certified for the credit in the following amounts:

†† This credit amount does not phase out. The full amount of the altenative fuel vehicle credit would be available for vehicles purchased on or before December 31, 2010.


2009 Model Year Hybrid Vehicles

Make Model Credit Amount

Ford Escape Hybrid 2WD $3,000
Ford Escape Hybrid 4WD $1,950
Mercury Mariner Hybrid 2WD $3,000
Mercury Mariner Hybrid 4WD $1,950


Advanced Lean Burn Technology Vehicles

Purchasers of advanced lean burn technology motor vehicles may claim a credit of $1,300 per vehicle.
Make Model Credit Amount
Volkswagen 2009 Jetta –2.0L TDI Sedan manual and automatic $1,300
Volkswagen 2009 Sportwagen –2.0L TDI manual and automatic $1,300
Mercedes-Benz GL320BLUETEC $1,800
Mercedes-Benz R320 BLUE TEC $1,550
Mercedes-Benz ML320 BLUE TEC $900

Have Questions? Contact us at:
MB Tax Professionals, LLP
503.595.5890
www.MBtaxpro.com
Office@MBtaxpro.com