New Tax Laws Proposed For Electric & Hybrid Vehicles
When the federal government spends more each year than it collects in tax revenues, it has three choices: It can raise taxes, print money, or borrow money. While these actions may benefit politicians, all three options are bad for average Americans. –Ron Paul
Recently, there have been multiple states that have begun to consider legislation which would specifically tax hybrid and electric vehicles. The reason, they are arguing, is that gas tax revenue is expected to drastically decrease in the future due to greater fuel efficient vehicles. As such, with much of the funding that goes towards our nation’s roadways arising from gas tax revenue, some states fear that at some point, the revenue generated will not be enough to help cover the costs of maintenance and upkeep.
However, this has a lot of people up in arms, specifically those that own electric and hybrid vehicles. They feel that they are being penalized for going “green”, also that on average, green vehicles are significantly more expensive to purchase. Most of which, do not receive sales tax breaks for purchasing such vehicles. It’s felt that more effort should go towards saving tax payer’s money rather than creating new laws to tax people more.
So what should be done?
It’s obvious that everyone does need to pitch in to ensure our roadways are safe and maintained. This is going to take money, which does indeed have to come in the form of taxes. But is our taxing system fair? With gas taxes, those with lower efficiency vehicles as well as those that simply drove more were already footing a larger portion of the bill. But perhaps the time to reexamine our tax system for maintaining roadways has come. What follow here are a few ideas of different methods of taxing that may be more fair for drivers.
Highway Tax Based On Usage
One option that should be considered is a highway tax based on usage. The number of miles driven as well as the weight of a vehicle certainly determine the overall wear and tear on our highway infrastructure, and when it comes down to it, that is the reason we are being taxed right? Because through our use of it, roadways become worn, and as such, those that use roadways more frequently and drive heavier vehicles should be taxed more. It seems fair from the surface, but there would certainly be those that disagree. Mainly, companies that deal with freighting and transportation, but again, they are using it more and should be paying more as a result.
Weight would be an easy determination and could be calculated into a taxing system relatively easy. As far as usage is concerned, there have been ideas about reporting your vehicles odometer reading annually and being taxed off of that. Deepening on the total number of miles driven in a year dictates exactly what should be taxed. Anyone caught falsifying their actual reading can be fined or face some form of penalty.
Highway Taxes Separate From Car Ownership
Another idea is that even though a person may not own a car, they should still pay for the upkeep of our highway system. The reason being that even though they are not driving, they are certainly benefiting from proper roadways being in place. They may be taking the bus, or carpooling, but beyond that, everything from the food they consume to the clothes they purchase and entertainment they enjoy at some point used roadways to make it’s way to them. Transportation in this country, and all that entails, is not free. There are costs, and we all benefit from it. For that reason we should all be chipping in to ensure our roadways are maintained and safe.
New Technology To Increase Roadway Longevity
There are those that feel rather than finding new ways to tax people for road maintenance, perhaps we should be investing in ways to increase the longevity of our roads. This can come in the form of new concrete compositions, or new materials that can be used altogether. In that way, the initial cost may be more expensive, but over the long run, the cost of maintenance and repair would go down. If this worked, we would not need to be taxed as much since once in place, roads could withstand a lot more wear and tear. This is sort of a proactive approach rather than a reactionary one, and should most definitely be considered by policy makers.
In The End
In the end, one of these options, a hybrid of them all, or other ideas should be considered. It certainly doesn’t make much sense to punish those for buying more fuel efficient vehicles when the trend in our country has been to become more fuel independent. If anything, a string of new laws taxing hybrids and electric vehicles will only result in the slowing of their acceptance by the public. Hopefully this will be resolved in the best manner and does not simply throw the burden onto a select few individuals. But as we know about the taxing system in this country, that is generally the case that occurs.
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The author of this article is Damien S. Wilhelmi. If you enjoyed this piece you can follow me on Twitter @JakabokBotch. If you are in need of a Colorado Brake Repair, be sure to check out one of the many AAMCO locations at AAMCOColorado.com.
Categories: Federal Tax, Income Tax, State Tax, Tax Law Tags: automobiles, cars and technology, electric cars, hybrid cars, laws
Five Ways To Avoid IRS Tax Problems
From business people and entrepreneurs to college students, individuals from all walks of life can feel overwhelmed when confronted with IRS tax problems. However, don’t panic if you get into a bit of trouble with the government; through the help of dedicated professionals, you can efficiently deal with these problems. Here are five ways to avoid serious tax problems this season.
1. File Returns Regardless of Personal Circumstances
Individuals need to file tax returns, even if they feel they have earned no taxable income. Some people go for years without filing returns. These misguided individuals may feel that if they’ve lasted so long without facing disaster that they can continue for years to come. Regardless of individual circumstances, not filing tax returns is a prosecutable federal crime. IRS agents have a habit of waiting until people are comfortable before moving in with swift, decisive action.
2. Pay Tax Bills on Time
The best way to avoid tax problems is to pay taxes fully and in a timely fashion. Beyond simply paying late fees and penalties, late payers increase their likelihood of facing audit. The IRS uses a software algorithm to influence its random selections of taxpayers for auditing. While the IRS naturally keeps details of this algorithm secret, any taxpayer actions that hint at noncompliance can likely cause problems.
3. Find Professional Tax Help
Fortunately, experienced accountants and tax attorneys have mastered plenty of techniques for guiding their clients avoid tax headaches. These attorneys can help people negotiate settlements with the IRS. Without these settlements, people can struggle with burdensome tax liens on their properties and possessions.
4. Communicate With the IRS
Individuals with tax problems should continue communicating with the IRS, no matter how unpleasant these interactions may become. Without adequate communication, the IRS may take drastic action by issuing levies. Levies are direct, enforceable requests for money from banks or other responsible institutions. For example, the IRS serves levies to banks to tap bank accounts for unpaid taxes. The IRS generally only issues levies when taxpayers are totally non-compliant.
5. Understand the Authority of the IRS
Some taxpayers simply postpone IRS negotiations with honorable intentions to comply at later times. Many assume that tax bills are subject to statues of limitations and are waiting until their problems disappear. Remarkably, the IRS is not bound by any statute of limitations. The IRS has tremendous power to seize homes, cars and all other assets. The tax authority continually gains new powers to harass and hound taxpayers. By exercising prudence and utilizing professional help, taxpayers can usually avoid IRS tax problems.
This is simply some advice to help you stay out of IRS tax problems, not a solicitation for legal services or tax help.
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License: Creative Commons image source
By Jordan Mallory, a single mom with experience working in taxes who writes as a hobby on the side.
Categories: Federal Tax, Income Tax, State Tax, Tax Evasion, Tax Law Tags: IRS, irs audit, irs extension, irs tax credits, irs tax services, irs wage garnishment
How To Deduct Moving Expenses For Taxes
While you move, you have already made the decision to invest in moving services in order to get your belongings to your new place. After all, moving all your furniture on your own can prove to be difficult as you may damage your own stuff. For that reason, you need to make sure that the respective mover you are about to hire is providing moving supplies, a moving truck, relocation insurance, and other required things like tools.
However, that’s just the logistics. What you’re really interested is saving money on your move. Luckily, you can deduct your move as an expense since the Internal Revenue Service or IRS has made it possible for particular expenses such as moving to be deducted on your tax return. If you went beyond your budget when you moved, this is a way to get back. Think about it like a rebate!
Most people who move every single year don’t take advantage of this deduction because they simply don’t know about it. Also, many people think that it’s more difficult than it really is. The question always arises: is this really deductible? How can I do it?
Honestly, deciding what you can deduct within your moving costs is quite easy. In this aspect, there are only some specific expenses which may be officially deducted through your taxes. These are things which the IRS sees as ‘acceptable deductions’ related to moving-related expenses such as:
- Costs that are directly connected to traveling from your old to the new destination
- Oil or Gas expenses
- Parking fees
- Mileage deduction (calculated by the mile)
- Tolls charges
- Shipping
- Connection as well as disconnection of utilities
- Costs related with the particular handling of moving pets
- Packing, transporting and crating of the household items as well as personal belongings
- Storage of private belongings for about 30 days from your move date
Here, you can find the cost amount associated to the move is also deductible. The main point again is to stay within your budget so you don’t get in financial trouble. You can deduct even more things when it comes to moving, but you may want to speak with a tax consultant. Avoid having a with the IRS. Don’t go off deducting moving related costs that do not quality, such as:
- Any charges connected to extra side trips for sightseeing as well as for visiting relations
- Costs associated to common vehicle repairs or maintenance during moving
- Costs of foods and meals within travel
- Also, the cost of your vehicle’s insurance
It is also vital for you to remember that while you are moving from one destination to another, you must be aware of the distance that you need to drive. It will help with getting an accurate quote and planning the trip to your desired destination. Moving is always an expensive agenda, so know there’s no way to escape that unless you plan on moving everything on your own. Prepare to pay a few thousand dollars if you are moving across state borders, and probably a few hundreds if you are moving in town. If you plan on moving by yourself, you may not be able to deduct as much as you will if you use an actual moving company. Research is a great way to find out what you can and cannot do when it comes to deducting moving expenses. Doing research will also help you plan for the best move, especially if you are about to do it on your own.
Tax deductions also occur at the coporate level when moving, as many commercial businesses and offices move every year. Businesses have so many costs so it’s important for them to itemize every expense, especially moving expenses. Everyone relocates at least once in their lifetime, but this fact is not only true for residential consumers. Surveys show that most business who survive at least 5 years in business end up expanding their business by moving to a new location which offers more space and accomodation. For commercial businesses, a moving company is normally hired and so the cost is easily deducted by the end of the quarter. We believe that it is truly beneficial to hire the services of a moving company, for an easy and smooth relocation experience.
Article by Isaac Atia, Head SEO Consultant at Premier Movers, a full service moving company based in North New Jersey. Premier is also known as extremely reputable NJ Movers and relocate hundreds of people every year.
Categories: Federal Tax, Income Tax, State Tax Tags: federal tax, tax, tax credits, tax deductions