CPA says no on Non Business Energy Tax Credit???????

[Hiram Maxim]

So my buddy calls me today(pissed off) and tells me that his CPA says he did not make enough money in 2009 to receive the 30% tax credit.

He claimed his income was $51,515.00 on the IRS 1040

How does the Energy Credit have to do with your income or is this CPA a total retard?????? hh:

He put in insulation, a new BK Princess, ss liner, hearth, 3 pain windows....spend a little over $6k

I don't get it, its a credit not a deduction????????

Any info welcome. (Today was the last day to file for 2009)

Thanks Hiram

 

[BrotherBart]

It is a credit against taxes owed. Don't owe any taxes? Nothing to credit against.

The reason I didn't buy any tax credit worthy items in the last two years. All of the stores/dealers for virtually everything are holding their prices because of the credit. After the credit ends I have a lot of stuff I need to buy when their business falls back off again.

Just like cars. I can buy one now cheaper than when "Cash For Clunkers" was shoring prices up.

 

[Hiram Maxim]

BB,

Thanks for that clarification!

Cheers,Hiram

 

[shawneyboy]

[quote author="BrotherBart" date="1287189391"]It is a credit against taxes owed. Don't owe any taxes? Nothing to credit against.

quote]

At 51k he should have paid some taxes... No ?
I am not an accountant but when my household income was around 55 k I know I paid tax.

 

[begreen]

It depends. If he is married, kids in college, has a business, or medical deductions, maybe nothing owed.

 

[RoseRedHoofbeats]

The way it was explained to me by several people was that if you were going to get a refund, then the 30% of the stove and install was added to it.

I am gonna be really pissed if this turns out not to be true.

~Rose

 

[jeff_t]

A tax credit is a tax credit,yes? If you work a normal 9-5 type job, and have enough taxable income to pay at least $1500 in taxes, then the credit is applied to that. What taxes are left to pay comes out of the withholding from your paycheck, then the rest is refunded. Self employed or small business owners may be different.

 

[geoffm24]

The way it was explained to me by several people was that if you were going to get a refund, then the 30% of the stove and install was added to it.

I am gonna be really pissed if this turns out not to be true.

~Rose

You are correct, even if you would be getting a refund you will get the tax credit on top of that. For example lets say you paid $10,000 in taxes and got a refund of $1,000 because you had $11,000 withheld. You also qualified for a $500 tax credit so you would now get $1,500 back. People who get refunds still pay taxes, refunds just relate to the withholding you had from your paycheck. Just because someone selected a different withholding rate then you and owed taxes on April 15th does not mean they would get the credit and you wouldn't. Trust me the government likes the over withholder a WHOLE BUNCH more then the under withholder.

If you in fact didn't have to pay any taxes ie. they with held $500 during the course of the year and then got the $500 refunded back to you then you would not get the credit.

 

[jeff_t]

It is entirely possible that someone with a $50k income and a bunch of dependents, medical bills, couple mortgages, student loans, business deductions, etc., will have enough deductions that he or she will owe little or no tax. No taxes owed=no tax credit.

 

[Hiram Maxim]

It is entirely possible that someone with a $50k income and a bunch of dependents, medical bills, couple mortgages, student loans, business deductions, etc., will have enough deductions that he or she will owe little or no tax. No taxes owed=no tax credit.

And that my friend was the case with my buddy. hh:

 

[Backwoods Savage]

Hiram, your buddy will still get all the benefits of the upgrades.

 

[Hiram Maxim]

Hiram, your buddy will still get all the benefits of the upgrades.

No Doubt Dennis.....He is real happy with his improvements as are his wife and two girls.
Hope all is well.Hiram