Bike to work, get a tax credit

If you haven't already noticed from the theme of my last few articles, the American Recovery and Reinvestment Tax Act of 2009 or the "Stimulus Bill" is chock full of lots of little and not so widely publicized tax credits that you should be aware of but are buried in the thousands of pages of legalese.

The Stimulus Bill included a provision that allows employers to provide their employees with a $20 fringe benefit per month for the purchase of a bicycle and any bicycle repairs, improvements or storage costs. Not a bad incentive and do we really need to mention the additional health benefits and carbon footprint benefits that will be achieved if you ride your bike to work. How about a big thank you from all the people stuck on 695 in morning rush hour traffic that may get to work a few minutes earlier because one less car is off the road. The benefits are endless.

For employees who regularly commute to work by bicycle, employers may offset the costs of bicycle purchase, improvement, repair, and storage at the rate of $20 per month. Based on how the employer chooses to offer the benefits, the employee may bring receipts to be reimbursed, may sign up for regular monthly payments or devise some sort of voucher system with their employer.

Bike commuters are not allowed to receive transit or parking benefits in addition to the bike benefit.

The bike commuter benefit can be provided by employers beginning January 1, 2009.
Here's a few links you might like to check out...

One Less Car - bicycle and alternative transportaion advocate in Maryland
WABA - the Washington Area Bicyclist Association

If you liked this stimulus bill article you may also find the following of interest...

New qualified expenses for qualified tuition programs - 529 Plans
First time homebuyer credit is hot this spring selling season


Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management or Taylor & Company in Towson, MD. He is a member of NAPFA and the MACPA and AICPA.

New qualified expenses for qualified tuition programs - 529 Plans

Here's another tax update brought to you by the "stimulus bill" or American Recovery and Reinvestment Tax Act of 2009.

The popularity of state sponsored College Savings Plans or 529 Plans is growing and with this little nugget added to qualified expenses, you can see why they are so popular.

In addition to tuition, fees, books, supplies and room and board if the beneficiary is at least a half-time student, the stimulus bill added computers, certain computer equipment and software and services. Many colleges and universities require students to arrive the first day of school with a computer and now, the expenses associated with that requirement are not eligible to paid for through a 529 plan.

For Maryland taxpayers, you can save on taxes while you save for college. You can deduct up to $2,500 of contributions per year, per account from your Maryland adjusted gross income for each of your beneficiaries. So a married couple filing a joint return can deduct $5,000 of contributions per year if each taxpayer opens one account for a beneficiary.

More information on the Maryland 529 plan known as the Maryland College Investment Plan can be found at the following websites:

College Savings Plans of Maryland
What's New in Qualified Tuition Programs or 529 plans

If you like this article you may also find the following of interest:

Tis the season for college savings plans and 529s
Should I save for Retirement or College first?

Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management or Taylor & Company in Towson, MD. He is a member of NAPFA and the MACPA and AICPA.

Brokers Using Scare Tactics To Badmouth Advisors

Brokers Using Scare Tactics To Badmouth Advisors

Posted using ShareThis

Dow Jones Industrial Average changes

After filing for bankruptcy protection, General Motors was ousted from the 30-stock benchmark Dow Jones Industrial Average (DOW) marking the end to 85 years in the Dow. Cisco Systems, the technology company that makes everything from set top boxes and wireless routers to enterprise level networking equipment was added. In a separate move, Citigroup was also replaced in the Dow by Travelers, an insurance company once part of the Citigroup empire.

The inclusion of Cisco Systems is further validation that technology is the leading industry in the US and no longer old line manufacturing. The publisher of the index says they were reluctant to remove Citigroup at the height of the financial frenzy. The Dow has come under scrutiny lately as some believe it is no longer the benchmark it once was as it became less reflective of the overall economy. These moves should stem some of that criticism.

In early stock market trading today the market seems to like the news. Cisco's stock is up nearly 4% with Travelers climbing nearly 3%.

If you liked this article you may also find the following of interest...
20 Small Ways to Save Big
Budgeting for Your Peace of Mind
Household Budgeting: Secrets to Marital and Money Bliss
Personal Budgeting: How to Create a Budget
Household Budget: 10 Sneaky Saving Strategies
Home Budget: Stop Living Paycheck to Paycheck

Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management in Towson, MD. He is a member of NAPFA and the MACPA and AICPA.

President signs the Credit Card Accountability Responsibility and Disclosure Act

This is a consumer alert that has a huge impact on you as a credit cardholder. The Act amends existing law and requires credit card companies to notify cardholders in writing at least 45 days prior to any change in the annual percentage rate (APR). It also gives the cardholder the right to cancel the account before the effective date of the rate increase.

Card companies can increase the APR if 1) the index on which the rate is based changes, 2) it is a promotional rate that has expired, 3) a cardholder fails to comply with a hardship workout plan or 4) the account fall 60 days past due.

There are lots of other provisions and a three page summary is provided by the US Senate here...

The Credit Card Accountability Responsibility and Disclosure Act of 2009

If you liked this article you may also like the following personal finance articles...
20 Small Ways to Save Big
Budgeting for Your Peace of Mind
Household Budgeting: Secrets to Marital and Money Bliss
Personal Budgeting: How to Create a Budget
Household Budget: 10 Sneaky Saving Strategies
Home Budget: Stop Living Paycheck to Paycheck

Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management in Towson, MD. He is a member of NAPFA and the MACPA.

2010 Health Savings Accounts (HSA) contribution limits announced

HSAs or Health Savings Accounts are gaining in popularity as the cost of health care premiums increase annually. Check with your employer if they offer HSAs that are only available with a High Deductible Health Plan offered by your employer. The nuts and bolts are essentially if you participate in a high deductible health care plan you typically receive a lower monthly premium for paying the first expenses out of pocket. The deductibles are $1,200 for self-only coverage and $2,400 of family coverage. In addition to the lower monthly premium you can save money in an HSA that is tax-deductible, regardless of your income level. The great thing about HSAs is that it's not a use it or lose it plan. You can carry over any unused balance to future years allowing you to save money tax free.

The 2009 annual contribution limits are $3,000 for self-only and $5,950 for family coverage. A catch-up contribution is available for taxpayers 55 and older of $1,000.

The 2010 annual contribution limits are $3,050 for self-only and $6,150 for family coverage. A catch-up contribution is available for taxpayers 55 and older of $1,000.

Check with your CPA or Financial Planner if it makes sense for you but more and more employers are offering the plans and in this writer's opinion, HSA's are a no-brainer.

Here are a couple links to more information on HSAs...

For detailed HSA information, rules and regulations check out www.hsa223.com

For a look at the 2010 contribution limits as published by the IRS check out www.thomacap.com/files/2010%20HSA%20savings%20rates.pdf

If you liked this article you may also like the following personal finance related articles...
20 Small Ways to Save Big
Budgeting for Your Peace of Mind
Household Budgeting: Secrets to Marital and Money Bliss
Personal Budgeting: How to Create a Budget
Household Budget: 10 Sneaky Saving Strategies
Home Budget: Stop Living Paycheck to Paycheck

Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management in Towson, MD. He is a member of NAPFA and the MACPA.

Where to Find Top Yields

Where to Find Top Yields
Tom Taylor, CPA appears in the June 2009 issue of Kiplinger's Personal Finance Magazine and reviews how investors can earn more yield by investing in preferred stocks.

Tom Taylor, CPA is a fee-only, independent Financial Planner and Certified Public Accountant and can be contacted at Thoma Capital Management in Towson, MD. He is a member of NAPFA and the MACPA.