In December of 2010, Senate Finance Committee Chairman Max Baucaus introduced legislation that made many of our most familiar tax credits permanent. Tax legislation is always complex, but what many Americans do not realize is often tax cuts or credits are temporary. One of the factors needed to help expand the American economy is continued incentives and credits for alternative energy sources. Many of our energy credits and incentives were in need of revision or were about to expire.
The bill if passed has extended provisions for many business and industries attempting to create new technology or jobs in the alternative energy sector. The bill also creates, extendsor makes permanent many tax cuts and incentives for the middle class. Many of these incentives the middle class have come to depend on to increase their refund or lower their tax bill.
For example, the rebates that the middle class has enjoyed on new vehicles was a temporary tax incentive. This bill extends through 2011 the tax credit for hybrid vehicles and natural gas vehicles. The vehicles must weigh above 8,500 pounds. It extends through 2011 the tax credits and payments for the alternative fuel ethanol and any blendings with gasoline. The act leaves the tariff on imported ethanol and ethyl tertiary butyl ether better known as ETBE. Other alternative fuel incentives were extended for biodiesel, liquid fuels from biomass, biogas, natural gas, and propane
The government is continuing its support for energy efficient homes. Manufacturers of energy efficient homes through the next year will receive a tax break. Existing homes can still receive the 30% credit, or $1500 maximum for purchasing materials to improve energy efficiency. U.S. energy efficient appliances will continue to have the credit, but the direct payment option of the tax credit has been modified for any 2009 or 2010 appliances.