Value added tax (VAT), or goods and services tax (GST) is a consumption tax levied on value added. In contrast to sales tax, VAT is neutral with respect to the number of passages that there are between the producer and the final consumer; where sales tax is levied on total value at each stage, the result is a cascade (downstream taxes levied on upstream taxes). A VAT is an indirect tax, in that the tax is collected from someone who does not bear the entire cost of the tax.
Continue reading Value Added Tax (VAT) – What it means to us

Could your retirement nest egg use a boost?

This may be a good year tot increase your retirement plan contributions, thanks to the IRS’s inflation adjustments for 2009. Key changes include:

Continue reading IRS’s inflation adjustments for 2009

Credits of Note
Two special tax credits worth noting for 2008 are the recovery rebate and first-time homebuyer credits.

Deductions You Want to Consider
Even though credits save you more than deductions, you still want to take deductions when you can.

Finally, exemptions are another area of tax breaks to know about. There is a personal exemption of up to $3,500 available to most taxpayers. If you’re lucky enough to work for an employer that offers Qualified Transportation Fringe Benefits, you also don’t have to pay income taxes on these benefits. Additionally, if you are in the military, any pay you received while serving in a combat zone in 2008 is exempt from income tax.