1. Suppose Maria spent $9,000 on reforestation in 1995, all of which was eligible for amortization. She plans to grow trees for 7 years, or more, which qualifies her to claim a tax credit of 10% of the costs eligible for the above amortization. If Maria is in a 28% tax bracket, calculate her tax savings because of the amortization over the 7 years. (Hint: see Marias amortization example)

• Calculate amortization Tax credit:

• Calculate amortization eligible amount:

• Calculate Marias tax savings: