Residents may benefit from new tax credits

Gilman Ciocia, a leading provider of federal, state and local tax planning and preparation services, is reminding residents of New York State about five new and existing money-saving deductions available this year.

New York State residents may be entitled to the following deductions:

+ Home Heating System Credit: If an existing home heating system has an Energy Star-labeled heating system in one's principal residence in New York State, one may be entitled to the "home heating system credit." The credit is available for tax years beginning in 2006 and 2007 and is allowed for costs incurred after July 1, 2006, and before July 1, 2007, that are directly associated with the replacement of the existing home heating system. If one moves from one principal residence to another principal residence in the state, and one replaces the home heating system in each residence with a heating system that meets the conditions to qualify for this credit, the individual will be allowed a separate credit of up to $500 for each residence.

+ Solar Electric Generating Equipment Credit: The solar energy system equipment credit is allowed for the purchase and installation of an eligible solar energy system. The equipment must be installed and used at a principal residence in NYS. The credit will be allowed for the tax year in which the solar energy system equipment is placed in service. For solar energy system equipment placed in service between Jan. 1, 2006, and before Aug. 31, 2006, the credit is 25 percent (but not to exceed $3,750) of the qualified expenditures for the purchase and installation of a system that generates solar energy for residential use. For equipment placed in service on or after Sept. 1, 2006, the credit is 25 percent (but not to exceed $5,000) of the qualified expenditures for the purchase and installation of a system that generates solar energy for residential use.

+ Empire State Child Credit: A full-year NYS resident may be entitled to the Empire State child credit if one has a qualifying child and has a federal child tax credit or a federal additional child tax credit (claimed on federal Form 1040 or Form 1040A) or if one's federal adjusted gross income is $110,000 or less if married filing a joint return; $75,000 or less and one's filing status is single, head of household or qualifying widow( er); or $55,000 or less and the filing status is married filing separate returns. A qualifying child is a child who meets the definition of a qualifying child under the federal child tax credit (Internal Revenue Code section 24(c)) and is at least four years of age on Dec. 31 of the tax year.

+ College Tuition Credit/Deduction: As a reminder, NYS residents can receive a percentage of the Federal College Tuition Credit. If an individual, spouse or dependent(s) was a student enrolled at or attending a higher learning institution, they may be entitled to a college tuition credit, which is available to full-year NYS residents only.

+ Long-Term Care Insurance Credit: If an individual pays premiums for qualified long-term care insurance, they may be able to claim a credit for tax years beginning on or after Jan. 1, 2002. The long-term care insurance credit is not refundable, but any amount of credit or carryover of credit not deductible in the current tax year may be carried over to be deducted for the following year or years.