Taxpayers can claim multiple tax credits provided by the federal stimulus package.
A taxpayer is allowed to take multiple tax credits authorized by the American Recovery and Reinvestment Act, commonly known as the federal stimulus package. Taxpayers are eligible for credits to help offset expenses for things like a new home, a college education and renewable energy upgrades. Some credits, such as the Making Work Pay credit, are available to most employed taxpayers in a particular income bracket. A given tax credit may only be claimed once, though some credits may be claimed for multiple years.
Making Work Pay Tax Credit and Recovery Payments
The Making Work Pay Tax Credit is available for 2009 and 2010 tax returns. Qualifying single filers can receive a tax credit of up to $400 on their tax returns, while taxpayers filing jointly may get up to $800. A taxpayer can take this credit along with most other stimulus tax credits including the American oppurtunity tax credit or the energy efficiency tax credits. This credit is offered in addition to Economic Recovery Payments -- stimulus checks for $250 issued by the federal government in 2009 -- however, taxpayers who received a Recovery Payment will have their Making Work Pay credit reduced by that amount.
College Tuition Credits
Taxpayers can claim a few different tax incentives to offset the cost of higher education. Those falling under the stimulus package include the Hope credit, the American Opportunity credit and the Lifelong Learning credit. Many of the college-related tax credits in the stimulus package either expanded upon or replaced existing education incentives, and most can be be claimed along with other educational and non-educational credits like the American Opportunity credit that finances tuition and other expenses related to college education. However, taxpayers who opt to take allowable tax deductions for tuition and fees, which is not part of the stimulus package, cannot take education credits too.
Renewable Energy and Energy Efficiency Credits
The stimulus package encourages energy efficiency and renewable energy development by providing credits to taxpayers who purchased energy improvements for their homes. As with education credits, energy credits can be claimed alongside other incentives such as the Making Work Pay Credit. Most of the time, a taxpayer can claim multiple energy efficiency credits for different home improvements. For example, a homeowner may claim both the Residential Energy Efficiency Property Credit for installing a renewable energy system and the Plug-In Electric Vehicle Credit for purchasing an electric vehicle. A homeowner cannot claim multiple credits for the same improvement.
Homebuyer Tax Credits
Tax credits were provided under the stimulus package to help finance the cost of a first home, or even a new home, under certain circumstances. This credit is known as the First-Time Homebuyer Tax Credit and is available to new home buyers -- taxpayers who have not owned a home for at least three years. While it is called the First-Time Homebuyer Tax Credit, it can also be claimed by taxpayers who owned the same home for more than five years and moved to a new one during 2008, 2009 or 2010. A taxpayer may take this credit along with multiple other credits, such as the renewable energy credits, Making Work Pay Credit or education credits. A homebuyer cannot claim multiple First-Time Homebuyer Credits. The credit can only be applied once and only to one home purchase during the tax year.
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