Are tax credits myths?

I had a pellet stove installed in my house. The cost was more than $3,000. It was a welcome addition because I can not afford to set my thermostat above 52 degrees. As the fireplace is in the dining room, which is effectively, the middle of the house (living room and kitchen are in a row with the dining room centered), it works to keep the first floor warm, as high as 60 degrees.

All sellers claimed the stoves qualified for up to $1,500 in energy credits.

As I went through the 1040, I itemized deductions and was able to have a larger deduction than the standardized amount.

The instructions have the homeowner determine their tax. Then the homeowner multiplies the cost of the improvement by 30%. If this 1/3 falls below the $1,500 maximum, then the filer must take the lower cost.

The filer then must state their tax to be paid, based, in my case on the tax table. If there are any other tax credits, these are to be subtracted from the tax "owed." (In quotation marks, because the amount has already been deducted and is in the hands of the government. . . at least on paper.)

As I had no other credits, the amount derived from the tax table works out to be my credit. That means, unless the feds 'correct' my return, as they did last year, that the entire $988 deducted will be returned to me.

[Now, some of the right-leaning members of this forum recently complained about a statistic they discovered that the bottom 40% of wage earners pay no taxes.

Of course, many of those on the bottom are teenagers who work low paying jobs.

But many of them are women like me, of varying levels of education (although the women with masters degrees do no better in the job market than those with high school or partial college educations) who are over age 50. This year, I had three jobs and one was miserable (working at the business school of a university). For much of the year, I worked seven days a week, which limited the contact I had with my family. I still earned less than $20,000. So, would you have a worker whose gross pay is under $2,000/month pay taxes at the same level as a professional athlete or a corporate CEO, the sort of person who is in the top 1% of earners in the country?]

But, to get back to the point, this is not the first time that so-called tax credits proved to be not all they seemed. The same year I bought this house, I expected to receive a credit for the installation of an energy efficient gas furnace.

The installation was not strictly due to a tree hugger impulse. During the inspection, I was informed that the furnace was 23 years old. The inspector told me that this sort of furnace had a life span of 20 - 25 years. I said to him that it would probably die on Super Bowl Sunday, when I couldn't raise a repair man for pure gold.

The replacement of the furnace yielded nothing in tax credits.

Certainly, people earning at a realistic level might benefit in terms of deductions, but, let's face it. A deduction is a once in a blue moon sort of thing.