Tax Credit

Here is a suggestion about what the governor could do about that great state surplus. In the late 1970s when Proposition 13 was passed, giving a substantial tax benefit to homeowners, the state gave a small assuaging tax benefit to people who did not own a home. It was called renter's credit and paid a small stipend of $60 a year to any person who paid $50 a month or more in rent. It was a refundable credit that could reduce the state income tax due by that amount, or if no tax was due, the individual could file for the renter's credit only and receive a refund check.

Could Congress' ambitious second round of home purchase tax credits -- especially the $6,500 repeat-buyer credit -- turn out to be lacking in terms of economic stimulus clout? With the April 30 deadline to sign home purchase contracts for both the $8,000 first-time buyer credit and the $6,500 version looming, some real estate and building experts are concerned that fewer consumers may be motivated by the credits this spring than last fall. The $6,500 credit, in particular, appears to be generating little buzz among shoppers.

Dear Karen: Is the tax credit for hiring formerly unemployed people going to stay in effect for 2011? Answer: The Hiring Incentives to Restore Employment Act, or HIRE Act, was signed in March as part of President Obama's $18-billion jobs bill, but it expires at the end of this year, said Brandon Edwards, chief executive of the Tax Credit Co. in Los Angeles. The act provides businesses with an exemption from Social Security payroll taxes for every worker hired this year who had been unemployed for at least 60 days before the hiring.

If you had a job at any time during 2008 but didn't earn much money, you could qualify for one of the nation's most lucrative, and most frequently missed, tax breaks -- the earned income tax credit. It is a tax break that can land a family with two children a refund of as much as $4,824 -- even when they paid no federal income tax. But about one-quarter of those who qualify don't claim the credit, the Internal Revenue Service says.

California's film tax credit program is giving taxpayers a bang for their buck. So says a newly released study by the Los Angeles County Economic Development Corp., which shows the state's tax credit program pumped $3.8 billion into the California economy and created more than 20,000 jobs in the last two years. Based on an analysis of expenditures from nine projects that received film tax credits from the state in the first two years of the program, the LAEDC found that for each tax dollar allocated, the local and state governments get back at least $1.13 in tax revenue and the total gross domestic product in the state increases $8.48.

Everybody loves lists. Most of those you see in the papers or online tend toward the inconsequential (The Six Best "Fast & Furious" Movies). So here's a list with a bit more gravitas: The five biggest lies you're being told about entitlement programs. Never mind that the very word "entitlement" is a lie. Social Security and Medicare got that name because workers became "entitled" to those benefits by paying into the system. In recent years, however, the term has become distorted to signify benefits people are entitled to without earning them.

American corporations that owe taxes to Panama will be allowed the U.S. foreign tax credit if payments are made to the government of ousted President Eric Arturo Delvalle and not that of military strongman Manuel Antonio Noriega, the Internal Revenue Service said today. The announcement was aimed at discouraging U.S. businesses from sending tax payments to the Noriega government, which Washington does not recognize. Some large U.S.

An index of home prices in 20 major cities gained ground in April. But analysts warned that prices are likely to fall again as the effects of a popular federal tax credit for buyers begin to wane. Prices of previously owned single-family homes rose 3.8% in April compared with April 2009, according to the Standard & Poor's/Case-Shiller index of 20 metropolitan areas, a closely watched index of home prices. The 20-city index was also up 0.8% from March, the first monthly gain after six consecutive months of decline.

Re "Firms Pay Nothing, Get Plenty," Dec. 26: The legislative statute requires that businesses that purchase new manufacturing equipment receive a 6% tax credit. Sales tax on equipment in Los Angeles is 8.25%. The state is giving only a partial credit on the sales tax collected. For Assemblyman Mark Ridley-Thomas to be critical of this tax credit is tantamount to canceling income tax refunds because state government is running a deficit. Other members of the Legislature were unhappy that the State Board of Equalization was legally providing state-promised credits.

A coalition of housing groups said implementing a homeownership tax credit similar to the one proposed by President Bush in his 2004 budget would create jobs, bring private investment to economically distressed neighborhoods and boost homeownership rates among people of all backgrounds and income levels.