In 2024, homeowners in the United States can take advantage of federal tax credits for installing energy-efficient HVAC systems. These incentives, established under the Inflation Reduction Act of 2022, aim to promote the adoption of environmentally friendly technologies. The tax credits are available through 2032, offering substantial savings for eligible installations. Eligible HVAC Systems and … Read more
Tax Relief Programs for First-Time Late Filers Yes, the IRS offers a specific relief program designed for taxpayers who have missed tax deadlines for the first time—the First-Time Penalty Abatement (FTA) program. This program is one of the most beneficial yet underutilized penalty relief options available to taxpayers. First-Time Penalty Abatement (FTA) Program The First-Time … Read more
Steps to File for IRS Penalty Abatement Filing for penalty abatement requires following specific procedures based on your situation. Here’s a comprehensive guide to the process for the three main types of penalty relief available from the IRS: Determine Which Type of Abatement Applies to You Before filing, identify which type of penalty abatement you … Read more
If you’ve missed the April 15, 2025 tax filing deadline, there are several actions you can take to minimize or potentially eliminate penalties. Here’s a comprehensive guide to reducing your tax penalties: File Your Return As Soon As Possible The failure-to-file penalty is substantially larger than the failure-to-pay penalty, so filing quickly is crucial: Pay … Read more
Missing the April 15, 2025 tax filing deadline can have different consequences depending on whether you’re due a refund or owe taxes to the IRS. Here’s a comprehensive breakdown of what happens when you miss the deadline: If You’re Due a Refund If the IRS owes you money, there’s generally no penalty for filing late. … Read more
Yes, you can claim both the HVAC system tax credit and utility rebates. However, the federal tax credit—known as the Energy Efficient Home Improvement Credit under Section 25C of the Internal Revenue Code—is calculated based on the net cost of the HVAC system after subtracting any utility rebates you receive. This means the rebate reduces … Read more
If your HVAC system doesn’t meet the required efficiency ratings for a federal tax credit, don’t worry—there are still steps you can take to address the situation. Here’s what you can do: Steps to Take Why It’s Worth the Effort Even if you miss out on the federal tax credit, taking these steps can help … Read more
IRS Form 5695, Residential Energy Credits, is used to claim the Energy Efficient Home Improvement Credit (Section 25C) for qualifying HVAC systems installed in 2025. This step-by-step guide will walk you through the process of completing and filing the form to ensure you successfully claim your tax credit. Steps to File Form 5695 Key Tips … Read more
Below is a general timeline based on previous tax seasons and the Protecting Americans from Tax Hikes (PATH) Act requirements. As of now, the IRS has announced the official start date for the 2024 filing season that is 27th Jan 2025. However, you can expect some version of the following schedule, subject to official IRS … Read more
A Coverdell Education Savings Account (ESA) is a tax-advantaged (often referred to as “tax-free”) savings account designed specifically for education expenses. Earnings in a Coverdell ESA grow tax-deferred, and withdrawals are tax-free as long as they’re used for qualified education costs, such as tuition, books, and other necessary supplies. Below is a brief overview of … Read more