Tax Relief Act – For Property and Income

The Tax Relief Act called for the extension of the 2010's tax cuts for another two years. The features include recovery payments that can help ease the burden of tax payers.

PHOTO BY PUBLIC DOMAIN

Tax Relief Act - Significant Deductions

The reduction of taxes and additional rebates are some of the main features of the tax relief act. The bill comes with significant tax deductions and credits. The tax relief act reduces the annual Social Security taxes with added incentives for business equipment investments. The current Social Security deduction from an employee's pay check is 4.2% compared to the previous year’s 6.3%. The self-employment tax rate is likewise reduced to 2%. Social Security and medicare taxes for the self-employed is now 10.4 % compared to the previous year's 12.4%. The business assets purchased this year also enjoy a 100% bonus depreciation. The equipment acquired can also be declared as business expense.

Property Tax Relief - Aid for Seniors

Senior homeowners are entitled to rebates with the current property tax relief. The meager income or financial support received by seniors and the disabled may not be enough to cover the annual dues. The objective of property tax relief is to help the senior and the disabled keep their home, while meeting their daily needs. Depending on the program of each state, the relief seeks to offer as much as $650 dollars in tax rebates. To avail, senior and disabled homeowners must receive an annual income of $35.000 or less. Those who are eligible to claim are homeowners who are 65 years old and above, widows or widowers who are 50 years old and above and disable citizen who are 18 years old and above.

Pension Tax Relief - Cash Benefits

Individuals receiving pension benefits are entitled to recovery payment under the pension tax relief. A retirement plan is an investment made by an employee during his work life. Individuals who are receiving retirement payments can receive of $250, while couples can receive 500 with the current pension tax relief. Government retirees can choose between the recovery payment or a $250 income tax credit. Taxpayers who are 65 years old are entitled to a 15% tax credit from the IRS if the gross income and social security benefit are within limit. Retirement funds are taxable however the collection is deferred until payment. Employees can conduct transfers, deductions that can protected the saved income from taxes.