Blog

Congratulations to the new graduates 🎓and their families.  I’ve been hearing about the great trips up to school for celebrations and packing marathons.  I remember those days and how we helped empty the dorm rooms of all that “stuff”.   I am sure more trips and celebrations are planned for this weekend and the rest of May, enjoy!

Some weeks and days the weather just doesn’t cooperate but it’s nice to get out even on those overcast May mornings…

For those times it’s great to have friends in the right places who send you photos to share, like this double rainbow taken by my friend Renee who moved from long island to Ashville NC….

Luckily my daughter Emily and son in-law Jeff missed or were missed by the recent tornado that touched down in their neighborhood. They were on the road during the height of the storm that hit Portage MI on Tuesday evening (think 1996 movie twister) so grateful they are safe…

There is more rain forecast for this weekend but I am still looking forward to my annual trip to the Brooklyn Terminal Market to shop for plants🌹🌼🌺🪴.  I hope you are planning to celebrate someone special 🤶 Enjoy.

WEEKLY TAKE AWAY

I continue to embrace the positive and look for those silver linings:  my kids came through the storm safely and the power outage from the Tornado many businesses were closed, my daughter Emily and son- in-law Jeff got the day off, they spent it playing frisbee and catch with my granddog Rory…

TAX ISSUES/TAX PLANNING

Tax Season is Over, It’s Tax Planning Season

Home Improvements May Be a Great Tax Planning Tool

This week in their daily and weekly news updates the IRS highlighted the energy credits available to assist homeowners.   We installed solar panels back in October 2023 and were able to plan reduced quarterly estimates based upon the energy tax credits that we will report on our 2023 tax return (yes, mine is on extension too).  I am happy to see that on nice spring days we are producing over 60 KWH of energy per day and that anything we don’t use will be banked for those winter days of short sunlight hours or overcast rainy days when production in low or non-existent.  Remember to follow the rules and guidelines and document, document, document and some of those home improvements you have made or are planning on can help save on current taxes.

As per IR-2024-137 : Taxpayers can claim the Energy Efficient Home Improvement Credit and the Residential Clean Energy Credit for the year the qualifying expenditures are made:

Energy Efficient Home Improvement Credit

Taxpayers that make qualified energy-efficient improvements to their home after Jan. 1, 2023, may qualify for a tax credit up to $3,200.

As part of the Inflation Reduction Act, beginning Jan. 1, 2023, the credit equals 30% of certain qualified expenses:

• Qualified energy efficiency improvements installed during the year which can include things like:
  • Exterior doors, windows and skylights.
  • Insulation and air sealing materials or systems.
• Residential energy property expenses such as:
  • Natural gas, propane or oil water heaters.
  • Natural gas, propane or oil furnaces and hot water boilers.
• Heat pumps, water heaters, biomass stoves and boilers.
• Home energy audits of a main home.

The maximum credit that can be claimed each year is:

• $1,200 for energy property costs and certain energy efficient home improvements, with limits on doors ($250 per door and $500 total), windows ($600) and home energy audits ($150).
• $2,000 per year for qualified heat pumps, biomass stoves or biomass boilers.

The credit is nonrefundable which means taxpayers cannot get back more from the credit than what is owed in taxes and any excess credit cannot be carried to future tax years.

Residential Clean Energy Credit

Taxpayers who invest in energy improvements for their main home, including solar, wind, geothermal, fuel cells or battery storage, may qualify for an annual residential clean energy tax credit.

The Residential Clean Energy Credit equals 30% of the cost of new, qualified clean energy property for a home in the United States installed anytime from 2022 through 2032.

Qualified expenses include the cost of new, clean energy equipment including:

• Solar electric panels.
• Solar water heaters.
• Wind turbines.
• Geothermal heat pumps.
• Fuel cells.
• Battery storage technology (beginning in 2023).

Clean energy equipment must meet the following standards to qualify for the Residential Clean Energy Credit:

• Solar water heaters must be certified by the Solar Rating Certification Corporation or a comparable entity endorsed by the applicable state.
• Geothermal heat pumps must meet Energy Star requirements in effect at the time of purchase.
• Battery storage technology must have a capacity of at least 3 kilowatt hours.

This credit has no annual or lifetime dollar limit except for fuel cell property. Taxpayers can claim this credit every year they install eligible property on or after Jan. 1, 2023, and before Jan. 1, 2033.

This is a nonrefundable credit, which means the credit amount received cannot exceed the amount owed in tax. Taxpayers can carry forward excess unused credit and apply it to any tax owed in future years.

Check out these IRS Links to requirements and qualifications at IRS.gov/HomeEnergy for energy efficient equipment prior to purchasing. Additional information is available on energy.gov, which compares the credit amounts for tax year 2022 and tax years 2023-2032. Specific rules and information is available at IRS.gov on qualifying residences and for taxpayers who also use a portion of their home for their business.

IRS Interest Rates Remain the Same for the Third Quarter of 2024

As per IR-2024-138: Interest rates will remain the same for the calendar quarter beginning July 1, 2024.

For individuals, the rate for overpayments and underpayments will be 8% per year, compounded daily.  Here is a complete list of the new rates:

• 8% for overpayments (payments made in excess of the amount owed), 7% for corporations.
• 5% for the portion of a corporate overpayment exceeding $10,000.
• 8% for underpayments (taxes owed but not fully paid).
• 10% for large corporate underpayments.

These interest rates are computed from the federal short-term rate determined during April 2024.

FOR OUR GRADUATES🎓

Congratulations to our graduates, how exciting and scary this time is for you.  As you celebrate with friends and family and field questions and advice about your plans for the future try to keep that smile on your face and remember:

• Highlight life experience on your resume and during your interview
• Check out the company website before you send out your cover letter and/or meet for an interview
• Focus on your short term and long term goals.
• Your major may not have prepared you for something specific, but researching potential careers via internet, your college or high school career office or brainstorming with friends and family may set you on the right path
• Be honest, it’s hard to be excited about a job or career where expectations are so unknown.

Good luck and remember to smile…

ECONOMY

Small Business Week:  Small Businesses Impact Our Economy

According to this report from Census.gov:  “Every year since 1963, U.S. presidents have issued a Small Business Week proclamation to recognize the contributions of entrepreneurs and small business owners. The theme of Small Business Week 2024, “Building on the Small Business Boom.”

Five Indicators that Show the US Economy is Still Firing on All Cylinders Despite Slowing GDP

According to this article in BusinessInsider.com:  “The US economy is firing on all cylinders despite a slowdown in first-quarter GDP growth, according to Carson Group global macro strategist Sonu Varghese.”

No Sign of Stagflation in U.S. Economy

According to this article in NBCNews.com which quotes Federal Reserve Chairman Jerome Powell:  “Even as inflation remains stubbornly high and some signs of slowing growth emerge, today’s economy can’t be compared to the problems of the 1970s.

Historically, stagflation occurs when high unemployment, slow economic growth and high inflation all happen at the same time.

Powell compared today’s economy, with both inflation rates and the unemployment rate below 4%, to that of the 1970s, the decade when most economists consider stagflation to have taken root.”

FTC Sued Over Ban on Noncompete Agreements

According to this article in Forbes.com:  “The U.S. Chamber of Commerce and other business groups are suing the Federal Trade Commission, accusing the regulator of overstepping its authority with its new rule banning non-competes—a clause prohibiting employees of a business from engaging in a similar profession or trade competitively against the employer.”

Key Points as laid out in the article:

The Federal Reserve Indicated Rates will Remain Higher for Longer

According to this article in APNews.com:  “Mortgage rates, credit card rates, auto loan rates, and business loans with variable rates will all likely maintain their highs, with consequences for consumer spending, after the Federal Reserve indicated Wednesday that it doesn’t plan to cut interest rates until it has “greater confidence” that price increases at the consumer level are slowing to its 2% target.”

The U.S. Labor Market is Shifting Toward Skilled Labor as White-Collar Hiring Slows

According to this article in NBCNews.com:  “America’s job market increasingly appears to be splitting into two tracks, economists say, alongside a steady demand for skilled workers and a flagging interest in hiring more “knowledge-based” professionals. The evidence can be found in the data, which shows higher unemployment for workers in business services and a lower one for people who work in manufacturing.”

GENERAL RESOURCES

• News about the Child Tax Credit
• The best source for up-to-date and accurate health information is the Center for Disease Control (CDC) 
• Our prior blog posts, videos and prior weekly newsletters 
• Entrepreneur put together a listing of free tech resources for remote work
• The Consumer Financial Protection Bureau has warnings about COVID-related scams 
• The New York Times has an online newsletter on K-12 and higher education 
• The Wall Street Journal has a collection of articles on education 
• The Louvre has digitized 482,000 artworks from its collection 
• How to create a strong password