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What taxpayers need to know: Taxpayers can claim the Energy Efficient Home Improvement Credit and the Residential Clean Energy Credit for the year the qualifying expenditures are made. Homeowners who improve their primary residence will find the most opportunities to claim a credit for qualifying expenses. Renters may also be able to claim credits, as well as owners of second homes used as residences. Landlords cannot claim this credit. IRS encourages taxpayers to review all requirements and qualifications at IRS.gov/HomeEnergy for energy efficient equipment prior to purchasing. Additional information is also available on energy.gov, which compares the credit amounts for tax year 2022 and tax year 2023. When it is time to file a tax return, taxpayers can use Form 5695, Residential Energy Credits, to claim the credit. more »

"...There is little sign of disinflation thus far in the category of core services excluding housing, which accounts for more than half of core consumer expenditures. To restore price stability, we will need to see lower inflation in this sector, and there will very likely be some softening in labor market conditions. Although nominal wage gains have slowed somewhat in recent months, they remain above what is consistent with 2 percent inflation and current trends in productivity. Strong wage growth is good for workers but only if it is not eroded by inflation...Despite the slowdown in growth, the labor market remains extremely tight. The unemployment rate was 3.4 percent in January, its lowest level since 1969. Job gains remained very strong in January, while the supply of labor has continued to lag." more »

"Retail sales for January also came in much stronger than expected, suggesting the economy was slowing less than it had appeared just a month earlier, a picture that was confirmed by data on personal spending, which represents almost 70 percent of gross domestic product. Continuing progress on inflation depends on lowering demand and moderating economic activity, and the retail sales and spending data suggest that progress on reducing aggregate demand may have stalled. Whether or not subsequent data confirm the setback in progress last month, the FOMC will do what is needed to reduce inflation to the Committee's 2 percent objective over time. It is possible there may be some bumps on that path, but I assure you, the FOMC's dual mandate objectives will be achieved." more »

"The cumulative deficit over the 2023–2032 period that we now project is $3 trillion larger than we projected last May, mainly because of newly enacted legislation and changes to the economic forecast that boost interest costs and spending on mandatory programs. Federal debt held by the public is projected to rise from 98 percent of GDP in 2023 to 118 percent in 2033 — an average increase of 2 percentage points per year. Over that period, the growth of interest costs and mandatory spending outpaces the growth of revenues and the economy, driving up debt. Those factors persist beyond 2033, pushing federal debt higher still, to 195 percent of GDP in 2053. The increase in mandatory spending is driven by rising costs for Social Security and Medicare. Total discretionary spending falls in relation to GDP. As the cost of financing the nation’s debt grows, net outlays for interest increase substantially." more »