In case you haven’t heard, the House of Representatives voted earlier this week to approve a $146 billion economic stimulus package by a 385-35 margin. Over in the Senate, Democrats have been pushing for a more generous plan but apparently don’t have the votes needed to push it through. Assuming they can’t make it happen, they’ll likely settle for the House version.

The key differences between the House and Senate version is that the former includes more restrictive income limits on the tax rebate, and also only allows rebates for people with earned income, thereby freezing out those living on Social Security and/or veteran’s benefits.

In case you’re curious, you can click through to check if you qualify for the House version of the tax rebate.

If you’re currently contributing to an IRA, or hope to do so in the near future, then you should be aware of the following IRA-related legislative changes for 2008…

You can now roll assets directly from a 401(k) to a Roth IRA. In the past you had to roll the funds into a traditional IRA and then convert to a Roth from there. This doesn’t get you out of paying any applicable taxes on the conversion, but it makes the process much simpler. In 2008 and 2009 you’ll most likely be eligible for this sort of direct conversion if you make less than $100,000. Starting in 2010, the income limit for Roth conversions goes away (but be careful).

IRA contribution limits are going up. In 2008, the maximum IRA contribution is $5,000 (or $6,000 if you’re 50 or older). And from 2008 onward, IRA contribution limits will be indexed to inflation (in $500 increments).

The income limits for deductible IRA contributions are going up. For tax year 2008, your entire IRA contribution will be tax deductible if your modified adjusted gross income (MAGI) doesn’t exceed $53,000 (for single filers) or $83,000 (for joint filers).

The income limits for Roth IRA contributions are going up. For tax year 2008, you can make the maximum Roth IRA contribution if your modified adjusted gross income (MAGI) doesn’t exceed $101,000 (for single filers) or $156,000 (for joint filers).

Yesterday I put together a list of common federal income tax deductions, so today I thought I’d follow up with a list of commonly missed tax deductions and/or income adjustments that I dredged up from various corners of the internet. While there’s a bit of overlap with yesterday’s list, there are a number of new items, as well. [more]

Recently, I’ve been seeing a lot of news about the so-called Fair Tax, which is being championed in one form or another by people like Mike Huckabee and Ron Paul. All of this talk about overhauling the federal tax system has gotten me to thinking about what effect such a system would likely have on our consumer-oriented economy. [more]

Over the weekend, I spent a couple hours pulling together tax records and wracking my brain to make sure that I don’t forget anything. Since I’m sure I’m not alone in this, I thought I’d put together a list of common tax deductions that many people qualify for. Keep in mind that this list is just a start, and that you’ll also want to verify that your eligibility before claiming them.

First up, some common federal tax deductions that you can take whether or not you itemize (as Curtis points out, these are technically ‘adjustments‘ as opposed to deductions):

1. Retirement contributions (Traditional or SEP-IRA, 401(k), etc.)
2. Student loan interest (up to $2,500/year on qualified student loans)
3. Capital losses (realized losses can offset unlimited capital gains or $3,000 in income)
4. Business expenses (business owners and employees with certain un-reimbursed expenses)

Next, some common deductions that you can take if you itemize:

1. Home mortgage deduction (deduct interest paid during the year)
2. Home equity loan deduction (deduct interest paid during the year)
3. State and local taxes (or sales tax if that works out better for you)
4. Charitable contributions (cash and property donated to a qualified organization)
5. Medical expenses (deduct those in excess of (7.5% of your AGI)
6. Personal casualty and theft losses (deduct your loss minus insurance payments)

Note that some of these deductions are subject to income limitations or other restrictions. For a more complete list of federal income tax deductions and adjustments, as well as details relating to each of those listed above, see IRS Publication 17.

Update: I’ve also put together a list of twelve commonly missed income tax deductions.

Update: Here is official guidance on qualifying for the tax rebate straight from the IRS.

While Congress still hasn’t passed the proposed $150 billion economic stimulus package that promises tax rebate checks for the majority of Americans, you might be wondering how much you’ll qualify for under the proposed terms of the plan.

Well, wonder no more… [more]

Yesterday morning I was driving to meet my wife for breakfast when I got pulled over for speeding. Apparently, I was going 65 mph in a 45 mph zone. Honestly, I find it hard to believe I was going that fast, because I glanced down as soon as I saw the speed trap and I was going maybe 15 mph over the limit. Nonetheless, I was most definitely speeding, and I’m not going to contest it.

I actually got pulled over earlier this year, got off with a warning, and have been much better about keeping an eye on my speed. But in this case, I got caught at the bottom of a huge hill that I had just coasted down. Moreover, it was along a stretch of highway that has an oddly low speed limit. In other words, it was a great place for a speed trap and, well, I was speeding. The cost of the ticket? $175. Ouch. The good news is that I can plead nolo contendre (no contest) instead of ‘guilty.’ I’ll still have to pay the fine, but I’ll avoid the points on my license (apparently you can do this once every five years in our area).

With that said, I also wanted to take a moment to welcome Wise Bread, the newest member of the MBN. I also want to wish Jim the best of luck — he’s decided to part ways with the MBN and go it alone.

And now, here are some financial articles that I thought might be of interest to you… [more]

We’re nearing the end of January, and last night I ran across an article that claimed that 92% of Americans fail to keep their New Year’s Resolutions, with a whopping 45% throwing in the towel within a month. With that in mind, I wanted to ask you guys how you’re doing?

As for me, we’re still on track with our goals for 2008, though we’re doing better in some areas than others. Here’s a quick rundown of how things are going… [more]

Here are some of my favorite FiveCentNickel (subscribe) posts from a year ago this past week:

» Most Common Financial Resolutions
» How to Get an Employer Identification Number (EIN)
» Super Bowl (and Stock Market) Prediction Poll Results

And here’s what was happening two years ago:

» An Interview with Ben Stein, Part 1
» An Interview with Ben Stein, Part 2
» How to Build a CD Ladder
» Scammed out of $15k
» Kill-a-Watt

Over the past week, I’ve put together some details about the tax rebates associated with the proposed economic stimulus plan. Given all the attention that this has been getting, I thought I’d put together a formal poll just to get a sense of how likely it is that people will do as the government is hoping and spend this money.

As a reminder, I noted in my tax rebate followup that this a straight up payment, and not an advance on next years tax refund. So, with that said, lets get to the poll…

Note: If the poll doesn’t work properly in the RSS feed you’ll have to click through. Sorry.