Anchorage Daily News

The federal American Recovery and Reinvestment Act provides tax incentives for first-time homebuyers, people purchasing new cars, those interested in making their homes more energy efficient, and parents and students paying for college.

Here are six tax incentives for individuals contained in the American Recovery and Reinvestment Act, the federal economic-stimulus law, according to the Internal Revenue Service:

First-Time Homebuyer Credit. Taxpayers who haven't owned a principal residence during the past three years and buy a house before Dec. 1 might be eligible for a tax credit of up to $8,000. They may claim the credit on an original or amended 2008 tax return or on their 2009 return.

New Vehicle Purchase Incentive. Qualifying taxpayers can deduct the state and local sales and excise taxes paid when buying new cars, light trucks, motor homes and motorcycles. The deduction applies to taxes on the first $49,500 on the purchase price per vehicle, and the deduction phases out for higher-income taxpayers.

Tax Credit for First Four Years of College. The "American Opportunity Credit" makes the Hope Credit available to more parents and students in 2009 and 2010. The maximum annual credit is $2,500 per student.

Certain Computer Technology Purchases Allowed for 529 Plans. College-savings 529 accounts now may be used to acquire computer technology or equipment, Internet access and related services in 2009 and 2010.

Energy-Efficient Home Improvements. This increases the credit for energy-efficient improvements for homeowners who make qualified improvements to existing houses. The improvements include adding insulation, energy-efficient exterior windows and energy-efficient heating and air conditioning systems.

For more information, go http://irs.gov/recovery.

ADVERTISEMENT