Also In Jan I did some work on the kitchen so I started saving receipts. Then in Feb I bought a used car. I have been keeping all of the receipts now. It took me less than five minutes to add-up all the receipts for the beginning of this year. You do not need to look up the actual sales tax, you just add to the total anything you did pay sales tax on. Then they have a percentage that you are supposed to apply when doing your taxes. At least that is how I remember it was supposed to work back when I used the table only. I'll see if that beats the table next year.

It could be different for some people, but for me and most other people I know your rate was so low that interest wasn't really an issue. On top of that since you do get to deduct it you're biggest reason to quickly pay off a loan (decrease the interest paid) doesn't matter since you're going to get it back. Like I said I guess it will vary from person to person. When I've had friends who are making the min payment on credit cards or cars so that they could make bigger student loan payments I ask what the hell they're thinking.

@MichaelBrazell: Yes, but you can only deduct up to $2,500 (as EarlNowak pointed out). It's a shame they cap it at that, since a lot of people focusing on paying their loans quickly will go over that cap (given the large size of most student loans x interest rates higher than they've usually been).

@EarlNowak: Definitely asinine. Seems like a bit of an incentive, but when you look at the contradictions it starts to fall apart. My parents were happy to claim the credits for my undergrad studies, but I don't think it's realistic to assume that most students are dependents or that their parents will be subsidizing them.

They should offer the credits to be used either while in school or within a certain time after (5 or so years). Give you a little boost when you're earning some money but trying to pay back education-related debt.

*standing ovation*

What I think is asinine is that these things aren't taught to highschool kids who are preparing to *go* to college. They have no idea the amount of debt they can burden themselves with and they have no concept as to how it will affect their life post-graduation.

I see kids who have attended private schools and accumulated HUGE amounts of debt. Many of them are going to be broke for many years after they graduate.

@Eyebrows McGee:

AMT must at least be pegged to inflation instead of being raised on an adhoc basis each and every year. Congress critters, take note.

Plus, the legislation was written for people who behave rationally and not people who want to have over a dozen children for "unconditional love" alone.

I think it's not so much a failure of the tax system as a failure of the American mental healthcare system. She could probably have gotten long term therapy for the same price as the IVF, and everyone would probably be a lot better off if she did. The people at the fertility clinic should have referred her, and culturally we should try to make it clear that therapy is helpful and isn't just for "crazy" people. It's a legit form of treatment, like going to the eye doctor to get glasses.

Otherwise, it's currently just a subsidy for a product that scarcely exists (there's the Tesla, but that' $100,000. A $2000 subsidy isn't going to make that cheap).

I also wonder how wise it is to offer a subsidy for battery capacity without regard to chemical composition. A big, heavy electric SUV would get a bigger subsidy than a small electric sedan with equal range. And a cheaper, but also more environmentally detrimental battery, would be better at gaming that system. I think range as found in an EPA-certified test would be a better metric for subsidy-worthiness.

It sucks that people have a hard time seeing the sarcasm in things, lol.

This year, any donations she receives are not reportable (ergo, donation will not generate any tax credit). If she earns any interest/dividends/capital gains from investing the proceeds of cash donations, those will be taxable but probably not significant. If the rumored $300k appearance fee she received for her first interview is real, any Child Tax Credit for which she'd be eligible would be reduced due to the amount of that reportable income - from $14,000 (the base amount) to a whopping $3,250.

Compared to the $75,000 or so she would owe in federal income tax on $300,000 in reportable income (once eligible deductions are accounted for), $3,250 is a rather laughable pittance, don't you think?

If you make under $55k, you can deduct $2500 of the student loan interest you've paid (tax savings of about $625), but it phases out above that level. If you make $70k or more, you can't deduct any student loan interest.

I think it's a little lame- students above half-time get a huge break while they're in school, but most students who are more than half time don't have time to work full time. Neither credit is refundable so to fully use the credit you need enough income that after your standard deduction and personal exemption you have $2000 of tax liability. That's between $18k and $30k depending on your situation, and I don't know many college or grad students pulling that kind of cash in school.

Then once you graduate, you can make student loan payments on par with a mortgage payment (say, $1000 per month), but only get to deduct $2500 of interest, and only if you're making under $55,000 dollars. Even if you're paying $12000 after tax dollars a year towards your federal student loans- and oh, by the way, if you default on those the government is on the hook for paying back the banks. I mean, we incentivize home ownership- shouldn't we incentivize higher education?

Didn't mean to rant. I just think it's a little asinine.

7. Allowable Child Tax Credit

NOW I understand why someone wanted 8 children!

So if you file single and own a house but your mortgage interest was only $4000, and you have no other itemized deductions, you can take the standard deduction ($5450) AND deduct real estate taxes paid on top of that up to $500.

And yeah, I would wager most people who are taking a sales tax deduction are in Florida or one of the other states with no income tax. I know my dad in Texas generally just uses the table to take a sales tax deduction, unless he's recently bought a big ticket item like a car, in which case he'll try to keep receipts.

@ARP: [apps.irs.gov]

You'd have to buy a lot of crap to make even the Chicago sales tax worth more than deducting your 3% state income tax. (Also, oy, the recordkeeping!)

I think it's meant to give a deduction to folks in those few states that have no income tax, which tend to have higher sales taxes to compensate.

@holocron: uhh... you ever hear of the hope credit?

[www.irs.gov]

@ARP: If you itemize your deductions you can deduct sales tax or property tax, but not both. If you don't itemize you would have to be paying a lot of sales tax to justify itemizing instead of taking the standard deduction.

This is 500 for single filers or 1000 for joint filers. Assuming you paid more than 500/1000 in property taxes for the year.

Am I reading #4 right? It says I can deduct sales tax. So if I live in Chicago (10.25% FTW), I can deduct all the crap I bought in this overtaxed city. I assume it's specific to some category of things. That can't be right.

Has the government officially declared our economy a disaster yet?

I think consumerist.com needs to provide links to where we can get more detail. I'm sure irs.gov, but if you wanted to get a bit more specific than that, that'd be awesome.