THIS WEEKEND IN CHICAGO - CHICAGOANS PICKING-UP WHERE THEY LEFT OFF!
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What an awesome Memorial Day Weekend we had here in Chicago last weekend,
and combined with a short work week, this weekend Chicagoans are picking-up
where...
Showing posts with label Tax Return. Show all posts
Showing posts with label Tax Return. Show all posts
4.17.2009
Listen up!
My accountant, Chris Wesolowski of West Tax Service, will be coming through your air waves tomorrow (Saturday 4/18/09) from 11am - 12pm on 890WLS. He will be speaking about tax and accounting issues relavant to today's economy!
3.11.2009
Article: 2009 Federal First-Time Homebuyers Tax Credit
Q: What is the amount of the new tax credit?
A: $8,000
Q: Who is eligible for the $8,000 tax credit?
A: First-time homebuyers who closed (or will close) on homes between January 1, 2009 and November 30, 2009.
Q: What are the details of the new tax credit?
A: The new tax credit is an $8,000 refundable tax credit (or up to 10% of the purchase price). This means that if your total tax liability in the given year is less than $8,000, the IRS will send a refund for the balance.
Q: What if I purchased a home between April 8, 2008 and January 1, 2009?
A: Purchasers who bought between 4/8/08 and 1/1/09 are subject to the terms of the $7,500 repayable credit.
Q: Do I have to pay back the credit?
A: If you occupy your home for three years, you will not have to pay back the credit.
Q: Who qualifies for the credit?
A: 1) First-time homebuyers (taxpayers who owned a main home at any time during the three years prior to the date of purchase are not eligible). 2) Purchasers of a “main home,” i.e. principal residence. The home must be a home located in the United States and is generally considered to be the home where you spend 50% or more of your time. It can be a condo, single family detached, co-op, townhouse or something similar. Vacation homes and rental properties are not eligible. For new construction, the “purchase date” is the date you occupy the home.
Q: Who do I contact if I have more questions about this credit?
A: Contact your REALTOR® or your tax preparer, or call the IRS toll-free at (800) 829-1040 for more information on the tax credit. This information is accurate based on the information available as of February 19, 2009. As with any tax law change, check with a tax advisor if there are any questions regarding using this provision.
Q: Who cannot take the credit?
A: Purchasers with any of the below circumstances cannot take the credit:
-Your income exceeds the phase-out range. This means joint filers with Modified Adjusted Gross Income (MAGI) of $170,000 and above and other taxpayers with MAGI of $95,000 and above.
-You buy your house from a close relative. This includes your spouse, parent, grandparent, child or grandchild.
-You stop using your home as your main home.
-You sell your home before the end of three years.
-You are a nonresident alien.
Q: What are the income limits?
A: The credit is reduced or eliminated for higher-income taxpayers. Joint filers with a MAGI of $170,000 and above and single filers with a MAGI of $95,000 and above are ineligible for the credit. Singles making between $75,000 and $95,000 and joint filers with a MAGI of between $150,000 and $170,000 are in the “phase-out” range, meaning you will only receive a fraction for the $8,000 tax credit.
Q: When/How can I claim the credit?
A: It can be claimed on your 2008 tax return (to be filed by April 15, 2009), an amended 2008 Tax Return, or your 2009 Tax Return.
3.01.2009
March 2009 Newsletter
If you would like to be added to my e-newsletter list, please send your email address to Lindsey.Grebitus@reSavvy.com!
2.01.2009
Article: A Home-Buyer Tax Credit Worthy of the Name
By Kenneth Harney, Washington Post
Should you give the $7,500 home-buyer tax credit a second look? Now that Congress may be on the verge of transforming it into a true tax credit -- one that never has to be paid back -- you just might want to do so.
On Jan. 15, the House Democratic leadership outlined its $825 billion economic stimulus package, loaded with $275 billion in tax cuts and $550 billion in new spending on health care, education, alternative energy and infrastructure improvements.
Tucked away in the tax section was a significant improvement to last July's congressional effort to stimulate home sales. That program offered a credit of up to $7,500 to purchasers who had never bought a house or hadn't owned one during the previous three years. To qualify, taxpayers would need to close on a house between April 8, 2008, and this coming July 1.
But relatively few consumers were attracted to the plan because, unlike virtually all other federal tax credits, this one had to be repaid in full to the IRS over a 15-year period. In effect, the $7,500 was more like an interest-free installment loan from the government than a straightforward dollar-for-dollar reduction on buyers' tax bills.
Though final details on a revised credit are still subject to negotiations between the House and Senate, and to passage of the economic stimulus package itself, there's a good chance that buyers who sought the credit in 2008, and new purchasers in 2009, will be relieved of the repayment requirement.
According to industry estimates, removing the repayment rule could lead to an additional 202,000 purchases this year. The National Association of Realtors is pushing for the July 1 deadline to be extended to Dec. 31, opening the door to even greater numbers of sales.
Meanwhile, the IRS has come out with two recent advisories on the credit, plus a new Form 5405 for taxpayers interested in claiming the $7,500 benefit, either for 2008 or 2009. You can download a copy of the form at www.irs.gov in the publications and forms section.
Based on the latest IRS guidance, here's what you need to know if you're thinking about buying a house this year -- taking advantage not only of low prices and record low mortgage rates, but also a temporary tax credit that may well turn out to be a grant.
* The $7,500 is available to singles, married couples filing jointly and unmarried co-purchasers, provided they meet the non-ownership test for the previous three years. Married couples filing singly can claim up to $3,750 each. Unmarried individuals can allocate the credit on their filings according to their respective ownership shares or capital investments in the house.
* Only principal residences, or in the IRS' words, "the one you live in most of the time," are eligible. No second homes, investment properties or houses located outside the United States pass the test. However, the definition of "home" extends far beyond conventional houses sited on lots. It "can be a ... houseboat, house trailer, cooperative apartment, condominium or other type of residence," according to Form 5405.
For example, if you buy a sailboat or powerboat with full living facilities, tie it up at a marina, and make it your "main home," you should be eligible to claim the credit, though you may want to run all the specifics of your situation by your accountant or tax adviser.
* Even if it's your first home purchase, you are not eligible if your adjusted gross income is above $95,000 (single filer) or $170,000 (married joint filers). Married couples with incomes between $150,000 and $170,000 are eligible for reduced credits, based on a phase-out schedule. Single filers with incomes between $75,000 and $95,000 also are subject to reduced credit limits. District of Columbia residents who are eligible for the city's first-time home-buyer credit are barred from use of the federal tax credit. Taxpayers who use tax-exempt mortgage bonds issued by state or local governments to finance home purchases also are ineligible.
* You can't claim the $7,500 credit if you buy your house from a "related person," meaning a spouse, parent, grandparent or child or from a corporation or partnership where you own more than 50 percent of the stock or capital interests.
If you pass all these tests, and get the purchase done by whatever deadline Congress decides on as part of the final stimulus package, you should be able to take $7,500 off your federal tax bottom line, and not worry about ever paying it back.
To read this article online, go to: http://www.washingtonpost.com/wp-dyn/content/article/2009/01/23/AR2009012301874.html
Distributed by the Washington Post Writers Group. Kenneth Harney is a nationally syndicated real estate columnist. He can be reached at the Washington Post Writers Group, 1150 15th St. NW., Washington, DC 20071-9200 or by e-mail at kenharney@earthlink.net.
Should you give the $7,500 home-buyer tax credit a second look? Now that Congress may be on the verge of transforming it into a true tax credit -- one that never has to be paid back -- you just might want to do so.
On Jan. 15, the House Democratic leadership outlined its $825 billion economic stimulus package, loaded with $275 billion in tax cuts and $550 billion in new spending on health care, education, alternative energy and infrastructure improvements.
Tucked away in the tax section was a significant improvement to last July's congressional effort to stimulate home sales. That program offered a credit of up to $7,500 to purchasers who had never bought a house or hadn't owned one during the previous three years. To qualify, taxpayers would need to close on a house between April 8, 2008, and this coming July 1.
But relatively few consumers were attracted to the plan because, unlike virtually all other federal tax credits, this one had to be repaid in full to the IRS over a 15-year period. In effect, the $7,500 was more like an interest-free installment loan from the government than a straightforward dollar-for-dollar reduction on buyers' tax bills.
Though final details on a revised credit are still subject to negotiations between the House and Senate, and to passage of the economic stimulus package itself, there's a good chance that buyers who sought the credit in 2008, and new purchasers in 2009, will be relieved of the repayment requirement.
According to industry estimates, removing the repayment rule could lead to an additional 202,000 purchases this year. The National Association of Realtors is pushing for the July 1 deadline to be extended to Dec. 31, opening the door to even greater numbers of sales.
Meanwhile, the IRS has come out with two recent advisories on the credit, plus a new Form 5405 for taxpayers interested in claiming the $7,500 benefit, either for 2008 or 2009. You can download a copy of the form at www.irs.gov in the publications and forms section.
Based on the latest IRS guidance, here's what you need to know if you're thinking about buying a house this year -- taking advantage not only of low prices and record low mortgage rates, but also a temporary tax credit that may well turn out to be a grant.
* The $7,500 is available to singles, married couples filing jointly and unmarried co-purchasers, provided they meet the non-ownership test for the previous three years. Married couples filing singly can claim up to $3,750 each. Unmarried individuals can allocate the credit on their filings according to their respective ownership shares or capital investments in the house.
* Only principal residences, or in the IRS' words, "the one you live in most of the time," are eligible. No second homes, investment properties or houses located outside the United States pass the test. However, the definition of "home" extends far beyond conventional houses sited on lots. It "can be a ... houseboat, house trailer, cooperative apartment, condominium or other type of residence," according to Form 5405.
For example, if you buy a sailboat or powerboat with full living facilities, tie it up at a marina, and make it your "main home," you should be eligible to claim the credit, though you may want to run all the specifics of your situation by your accountant or tax adviser.
* Even if it's your first home purchase, you are not eligible if your adjusted gross income is above $95,000 (single filer) or $170,000 (married joint filers). Married couples with incomes between $150,000 and $170,000 are eligible for reduced credits, based on a phase-out schedule. Single filers with incomes between $75,000 and $95,000 also are subject to reduced credit limits. District of Columbia residents who are eligible for the city's first-time home-buyer credit are barred from use of the federal tax credit. Taxpayers who use tax-exempt mortgage bonds issued by state or local governments to finance home purchases also are ineligible.
* You can't claim the $7,500 credit if you buy your house from a "related person," meaning a spouse, parent, grandparent or child or from a corporation or partnership where you own more than 50 percent of the stock or capital interests.
If you pass all these tests, and get the purchase done by whatever deadline Congress decides on as part of the final stimulus package, you should be able to take $7,500 off your federal tax bottom line, and not worry about ever paying it back.
To read this article online, go to: http://www.washingtonpost.com/wp-dyn/content/article/2009/01/23/AR2009012301874.html
Distributed by the Washington Post Writers Group. Kenneth Harney is a nationally syndicated real estate columnist. He can be reached at the Washington Post Writers Group, 1150 15th St. NW., Washington, DC 20071-9200 or by e-mail at kenharney@earthlink.net.
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