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Adoption Credit
If you adopted a child, you may be able to take a credit
for qualified adoption expenses of up to $10,930 per
child. If you adopted a special needs child, you may
claim a credit of $10,930 regardless of your expenses.
The credit is phased out if your adjusted gross income
is over $164,410.

Child and Dependent Care Credit
If you were working and had dependent care expenses
for a dependent child under age 13 or for a dependent
or spouse who is disabled, you may be able to claim a
credit for these expenses. This nonrefundable credit is
calculated based on your dependent care expenses
and your income. The maximum credit is $1,050 for the
expenses for one qualifying child or $2,100 for more
than one child.

Child Tax Credit
You may qualify for a credit of up to $1,000 per
qualifying child. A qualifying child is an individual who is
under age 17 at the end of the year, is claimed as a
dependent, and meets the definition of a child under
the Uniform Definition of a Child as a son, daughter,
stepchild, adopted child, grandchild or eligible foster
child.

The Additional Child Tax Credit
You may receive less than the full amount of the Child
Tax Credit because this credit is limited to your
available tax liability. In certain cases, you may be
entitled to an additional credit in excess of your tax
liability. The additional child tax credit is available to
taxpayers with an income greater than $11,300, and is
a refundable credit.

Earned Income Credit
The Earned Income Credit is a refundable credit for
low-income workers with earned income. The credit is
available for taxpayers with or without children. You
could be entitled to a refundable credit of up to $2,747
(if you have one qualifying child), $4,536 (if you have
more than one qualifying child), or $412 (if you have no
qualifying children or no children at all).

You have earned income if you work for someone else
or if you are self-employed. Taxable earned income
includes wages, salaries, tips, union strike benefits,
long-term disability benefits received prior to minimum
retirement age, and net earnings from self-employment.
For tax years through 2007, you may elect to include
nontaxable combat pay in earned income for the
Earned Income Credit purposes. The ability to decide
whether to include the combat pay enables you to
choose the largest possible Earned Income Credit.

If you qualify for the Earned Income Credit, it reduces
the tax you owe. The credit is refundable if your
withholdings and Earned Income Credit amount are
greater than the tax liability you may have on your tax
return.

Hope and Lifetime Learning Credits
There are two nonrefundable tax credits available for
qualified tuition and related expenses for
post-secondary education. You may be able to claim a
Hope Credit of up to $1,650 for each eligible student.
The Hope credit is available for the first two years of
qualified post-secondary education. You may be able to
claim a Lifetime Learning Credit of up to $2,000 for the
family. The Lifetime Learning credit is available every
year you, your spouse, or a dependent pays for any
qualified education expenses.

Retirement Savings Contributions Credit
If you contribute to an IRA or an employer-provided
retirement account, such as a 401(k), you may be
eligible for a credit. The credit is based on up to $2,000
of your contribution for the year. You must be age 18 or
older to claim the credit and you cannot be a student or
claimed as a dependent on another's return. The credit
is in addition to any deduction or exclusion from income
for the contribution.

Credit for Excess Social Security Tax or Railroad
Retirement Tax (RRTA) Withheld
The maximum Social Security taxes or RRTA tier 1 an
individual must pay in 2006 is $5,840. If you worked for
one employer and paid more than $5,840, you must
contact your employer for a refund of the overpayment.
If you worked for more than one employer and the
combined total of your Social Security taxes or RRTA is
greater than the maximum amount, you may claim the
excess taxes paid as a refundable credit on your tax
return.

Foreign Tax Credit
If your Form 1099-INT or Form 1099-DIV shows you paid
foreign taxes, you may be eligible to claim either a credit
or an itemized deduction for these taxes. Generally, the
foreign tax credit results in a greater tax savings than
deducting the foreign taxes as an itemized deduction.

Residential Energy Credits
There are two new nonrefundable credits available for
taxpayers who make their personal residences more
energy efficient. For both residential credits, the home
must be your principal residence, must be located in the
U.S., and the property or improvements must have a
reasonable life expectancy of at least five years. The
new energy credits are both nonrefundable credits
available for new improvements placed in service during
tax years 2006 through 2008.

Non-business Energy Property Credits
The Energy Property Credit is a $500 maximum
nonrefundable credit. The combined credit over three
years for all components is $500. Unused credit in any
year cannot be carried forward and is lost. This credit
may be used to offset any alternative minimum tax (AMT)
liability. The credit is based on 10% of the cost of
installing:
Windows, exterior doors, metal roofs, and new
insulation. The credit for windows is limited to $200.
Main circulating fans ((limited to $50)
Qualified hot water heaters (limited to $150)
Central air conditioning or furnaces (limited to $300)

Residential Energy Efficient Property Credits
The residential energy efficient property credits are
available each year in full, may not be carried over, and
may not offset the AMT. These credits are available on
the installation of:
Solar water heating system, limited to 30% of the cost
($2,000 maximum credit). This is not available for spa or
pool water heating systems
Solar energy production system, limited to 30% of the
cost ($2,000 maximum credit)
Qualified fuel cell power plant, limited to 30% of the cost
($500 maximum credit for each 0.5 kilowatt of capacity)

Alternative Motor Vehicle Credit
The Alternative Motor Vehicle Credit includes
nonrefundable credits for certain new vehicles you
purchased for your own used after December 31,2005.
The vehicle must be made by a manufacturer.
Passenger automobiles and light trucks are covered in
this section. The credit is not available as an offset for
the AMT.

When determining the tax credit, specific rules and
maximums apply to each vehicle type:
Hybrid and advance lean-burn - $3,400.
Fuel cell - $12,000 for tax-years 2006 through 2009
Alternative fuel - $4,000. As of July 2006, the following
vehicles have been certified by the IRS as Qualified
Alternative Fuel Motor Vehicles (QAFMV) for the credit
in the following amounts:
Honda Civic GX Model Year 2005 - $4,000
Honda Civic GX Model Year 2006 - $4,000
Honda Civic GX Model Year 2007 - $4,000

The car dealership where you purchased your car can
provide you with the certification of the amount of credit
available on the car when you purchase the vehicle.