elliottonrealestate.com
Residential Brokerage

Could the Tax Credit Be Extended Again?

March 1, 2010 by Elliott Robinson · Leave a Comment 

The pressure is increasing on Congress to renew the homebuyer tax credits for a third time.

The first $7,500 tax credit was passed in 2008 and required first-time buyers to repay the credit over 15 years. A few months later in 2009, Congress expanded the credit to a maximum of $8,000 that didn’t have to be paid back.

At the end of last year, Congress extended the benefit again until April 30 with an extra two months on top of that to close. A new credit of $6,500 was added for move-up buyers, too.

Now representatives of the housing industry are lobbying for another extension. Some experts, including Mark Zandi, chief economist at Moody’s Economy.com, who supported the earlier credits, think the time has come to let it go.

“It’s worn out its benefit,” he says. “If you extend it again, it isn’t going to do much, and what you’re doing is providing a tax break to folks who bought anyway.”

Source: The Wall Street Journal, Nick Timiraos (02/22/2010)

———————————————————
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Buyer Assistance, For Buyers, For Sellers
Tagged: , , , , , , , , , , , , , , , , , , , ,
Residential Brokerage

Homebuyer Tax Credit Deadline Looming

February 22, 2010 by Elliott Robinson · Leave a Comment 

The Homebuyer Tax Credit is set to expire this summer.  The tax credit is available to both First-Time Homebuyers and Step-Up Homebuyers. The provision to make the tax credit eligible for Step-Up Homebuyers was added when the law was extended.

There are some very important deadline dates that you should be aware of if you intend to take advantage of the Tax Credit.  The first is April 30th, 2010.  If you are purchasing a property and you intend to receive the tax credit, you must have the property under contract by April 30th, 2010.  The second date is June 30th, 2010.  You have to close on the above referenced property by June 30th, 2010 in order to receive the tax credit.
There is ZERO indication that the credit will be extended beyond those dates, so please do not tempt fate and prolong your home buying/selling process under the premise that the tax credit will be extended.  The strongest Congressonal and Administration proponents of this Law have clearly indicated that this is a one-time opportunity and there is no intention to extend it beyond this summer.
The website http://homebuyertaxcredit.com is an excellent resource for information regarding the Tax Credit.  Below you will find some questions and answers from their website which help to clarify who is eligible, how they are eligible and the process.  If you have any questions, please feel free to give me a call at 404-431-2117.
First-Time Home Buyer Tax Credit Eligibility
Q. What are the basic eligibility requirements for a first-time home buyer?
To qualify for the first-time home buyer tax credit, you cannot have owned a home as your principal residence in the three years prior to closing.
Q. How much is the first-time home buyer tax credit?
The first-time home buyer tax credit is 10% of your purchase price up to $8,000.
Q. I bought a home once before, but sold it years ago. Do I still qualify as a first-time home buyer?
For the first-time home buyer tax credit, you qualify as a first-time home buyer so long as you have not owned a primary residence in the past three years prior to closing on your new property. So if you owned a home in the past, but sold it more than three years ago, you would qualify as a first-time home buyer.
Q. Can I qualify as a first-time home buyer if I rent my primary residence, but own an investment property or vacation home?
Yes, you could still qualify as a first-time home buyer. Even if you own property, you are still eligible if you have not used that property as your primary residence within the prior three years.
“Step-Up” or Long-Time Homeowner Tax Credit Eligibility
Q. Can I get a credit if I currently own a home?
To qualify as a long-time homeowner, you must have owned a home that you lived in as your personal residence for five consecutive years out of the previous eight years prior to closing.
Q. Can I get the tax credit if I lived in one home for four years, sold it, and then immediately bought and lived in another home for the last two years?
You would not qualify. In order to be eligible for the long-time homeowner tax credit, you must live in the same home for five consecutive years out of the last eight.
Q. Can I get the long-time homeowner credit if I otherwise qualify, even if I don’t sell my previous home?
Yes, the law does not require that you sell the home that you lived in for five consecutive years out of the last eight years. You can keep title to it. However, you have to make the qualifying home your principal residence, so you can’t live in the prior home.
Q. Can I get the credit if I owned one home for ten years, and my current home for three?
No, to get the long-time homeowner home buyer tax credit, you must have lived in your current residence for at least five consecutive years out of the last eight.
Q. Can I sell my current home, and buy a less expensive home, and qualify for the “step-up” tax credit?
Yes. The term “step up” is misleading, because nothing in the law requires that you have to “step up” in value. You do not have to buy a more expensive home. We try to use the term “long-time homeowner tax credit” to make it clear how the credit works.
Income Qualifications
Q. How much can I make and still qualify for the tax credit?
The tax credit is only available at certain income levels: up to $125,000 for single filers and $225,000 for joint filers. The income limits are the same for both first-time home buyers and long-time homeowners. If you make within $20,000 of those limits, you can still qualify for a partial tax credit. But if you make over $145,000 for single filers or $245,000 for joint filers, you are not eligible.
Q. How do I figure out my “modified adjusted gross income” or “MAGI”?
You really should talk to your accountant about it, but generally speaking, your MAGI is what we all colloquially think of as our “income” – wages, salaries, interest income, dividends, and capital gains. Your MAGI also includes certain foreign income, but very few people have that. Note that your MAGI will be reduced by certain deductions such as alimony, but not the ‘below the line” itemized deductions that are on Schedule A of your tax return. Since your MAGI is very close to the “adjusted gross income,” or “AGI,” you can check your last tax return to see what you make: the AGI is the last number on Form 1040or 1040A.
Q. How is the partial credit figured?
The partial tax credit is available for taxpayers whose income is within $20,000 of the income limits: so up to $145,000 for single filers and $245,000 for joint filers. If your income is within that “phase out range,” you get a partial credit based on how much of your income is within that range. For example, if your MAGI is $130,000 as a single filer, that means you’re $5,000 into that $20,000 range. That’s 25% of the range, leaving 75% still in the range. So you would get 75% of the tax credit you’re entitled to: $6,000 if you’re a first-time home buyer (75% of $8,000) or $4,875 if you’re a long-time homeowner (75% of $6,500).
Deadline Issues
Q. When do I have to be in contract?
In order to claim either first-time home buyer tax credit, or the long-time homeowner tax credit, you have to be in contract by April 30, 2010. This is a hard deadline, with no extensions.
Q. When do I have to be in closed?
In order to claim either first-time home buyer tax credit, or the long-time homeowner tax credit, you have to be closed by June 30, 2010. This is a hard deadline, with no extensions.
Q. What if my closing is delayed because of problems with appraisals, attorney delays, etc.?
It doesn’t matter. The IRS has been very exacting with the deadlines. If you don’t close by midnight June 30, 2010, you will not be able to claim the tax credit.
Q. What if I was already in contract at the time the law was passed in November?
It doesn’t matter when you went into contract, so long as you are in contract by April 30, 2010. So long as you otherwise qualify, and close by June 30, 2010, you will get the tax credit. Obviously, a number of people who got into contract without realizing they were going to be eligible for the tax credit are going to get a windfall.
Q. What if I was not eligible for a tax credit on the law prior to November 2009, and closed before the new law? Can I get a tax credit?
No, the law only applies to closings after November 6, 2009, and before June 30, 2010. If you closed on November 6, 2009 or earlier, and did not qualify for the tax credit at the time of your closing, you cannot get the new tax credit.
Buying with Someone Else
Q. If I am buying with someone else, and we both qualify, do we get two tax credits?
No, the tax credit is allocated according to the purchase, not the number of purchasers. So if two people who both qualify purchase a house together, they would split the applicable tax credit.
Q. What if I qualify for the credit, but my spouse does not?
In order to claim either the first-time home buyer tax credit, or the step-up home buyer tax credit, both spouses must be eligible. So if you are eligible, but your spouse is not eligible for whatever reason, neither of you can claim the tax credit.
Q. What if my income is within the limitations, but my spouse’s income is above the limitations?
In that case, unfortunately, neither of you qualify for the tax credit. Both of you must qualify.
Q. What if I previously owned a home in the past three years, but my spouse never owned a home?
In that case, unfortunately, neither of you qualify for either tax credit. You are ineligible for the first-time home buyer tax credit because you owned a home in the past three years, and she is ineligible for the long-time homeowner tax credit because she never owned a home before.
Q. What if my wife and I just got married after living in separate homes, and both qualify for the long-time homeowner tax credit for our prior homes.
Unfortunately, you don’t qualify. In order for a married couple to qualify for the “step-up” home buyer tax credit, both spouses must qualify by owning the SAME principal residence. You each owned separate principal residences, so even though you both might qualify separately, you don’t qualify together.
———————————————————
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Buyer Assistance, For Buyers, For Sellers
Tagged: , , , , , , , , , , , , , , , , , , ,
Residential Brokerage

Tax Credit Encourages Buyers to Shop Early

January 22, 2010 by Elliott Robinson · Leave a Comment 

The homebuying season is starting early this year, thanks to the expanded first-time and move-up homebuyer tax credit.

Typically, the busiest time for home shopping starts in March and continues through May, but this year buyers who want to take advantage of the tax credits have to have a signed contract by April 30 and close the deal by June 30.

That is getting people off the couch.

“The tax credit will absolutely have an effect,” says Pete Flint, CEO of residential real estate search engine Trulia.com. “It is going to shift demand from the later part of the year to the first part. January and February will be very strong. The next three months, there will be a surge in demand.”

Source: USA Today, Stephanie Armour (01/20/2010)

———————————————————
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: For Buyers, For Sellers
Tagged: , , , , , , , , ,
Residential Brokerage

The Homebuyer Tax Credit is Extended and Expanded

November 6, 2009 by Elliott Robinson · Leave a Comment 

The bill signed into law today by President Obama, extends an $8,000 first-time home buyers’ tax credit that was set to expire at the end of this month. The credit will apply to all house contracts entered into before April 30, 2010, and closed by June 30.  The credit would be extended an additional year, until June 30, 2011, for members of the military serving outside the United States for at least 90 days.

Purchases Covered

The $8,000 credit for first-time homebuyers has been retained.  The law also creates a new $6,500 credit for existing property owners looking to sell their home and buy another during the same period of time.  The plan allows homebuyers who have lived in their residence at least five of the last eight years to receive a $6,500 credit.  The credit is available for the purchase of principal homes costing $800,000 or less, meaning vacation homes are ineligible.

Income Limits

Couples earning as much as $225,000 a year and individuals earning up to $125,000 would qualify. That is up from the current $75,000 limit for individuals and $150,000 for couples. The credit would be phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

Goldman Sachs Group Inc. said in a research note yesterday that the credit probably spurred 200,000 home sales that otherwise wouldn’t have occurred.

“This is probably the last extension,” said Sen. Johnny Isakson, R-Ga., a former real estate executive who championed the credits.

The real estate industry has been pushing to extend and expand the housing tax credit. About 1.4 million first-time homebuyers have qualified for the credit through August. The National Association of Realtors estimates that 350,000 of them would not have purchased their homes without the credit.

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Buyer Assistance, For Buyers, For Sellers
Tagged: , , , , , , , , , , , , , ,
Residential Brokerage

House Approves Home Tax Credit

November 5, 2009 by Elliott Robinson · Leave a Comment 

WASHINGTON (MarketWatch) — The House of Representatives on Thursday approved an extension of jobless benefits and a tax credit for home buyers, sending the measure to President Barack Obama for signature.

The bill, approved unanimously by the Senate late Wednesday, extends unemployment benefits for up to 20 weeks.

It also keeps a first-time home buyer tax credit alive until next spring, and expands it to include some people who already own a house.

The vote was 403 to 12.

The bill extends jobless benefits in all states for 14 weeks, and for up to 20 weeks in states where the unemployment rate is above 8.5%.

Obama may sign the bill as early as Friday.

The U.S. unemployment rate is at a 26-year high of 9.8%, and the White House is warning that job losses will continue even as the economy recovers. The latest U.S. jobs figures are due Friday morning, and economists surveyed by MarketWatch estimate that the country lost 150,000 jobs in October. See Economic Calendar.

An $8,000 credit for first-time home buyers now set to expire this month is extended through April 30 under the bill.

The bill also allows people who have lived in a home for at least five years to claim a $6,500 credit if they purchase a new home.

House lawmakers voted after the Labor Department reported Thursday morning that the number of people filing initial claims for state jobless benefits dropped by 20,000 to a seasonally adjusted 512,000 in the latest week. It was the first decline in two weeks and the fewest initial claims since early January. See full story.

But the jobless claims figures don’t point toward quick job-creation, analysts say.

“If the pace of decline from the peak is maintained, we are still some five months away from claims reaching the level that will signal net job growth,” wrote RDQ Economics economists.

The bill also includes a tax provision allowing small businesses to write off losses they incurred during the recessio

By Robert Schroeder, MarketWatch

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Buyer Assistance, For Buyers, For Sellers
Tagged: , , , , , , , , , , , ,
Residential Brokerage

Senate Approves Tax Credit Extension, Expansion

November 5, 2009 by Elliott Robinson · Leave a Comment 

The Senate yesterday passed legislation to extend the $8,000 home buyer tax credit to May 1, 2010, for first-time buyers and add a $6,500 tax credit for repeat buyers if they’ve lived in their home for five of the past eight years. Home prices are capped at $800,000.

The legislation was included in a bill to extend unemployment benefits and is expected to be passed by the House today or tomorrow. President Obama is expected to sign the legislation when it’s sent to his desk.

Under the bill, income limits are expanded to $125,000 for individuals and $225,000 for joint filers. Individuals with incomes up to $145,000 and joint filers with incomes up to $245,000 qualify for reduced credits.

Households who have binding contracts in place by April 30 will be allowed an additional 60 days to complete their transaction. The deadline for members of the military serving out the U.S. for at least 90 days between Jan. 1, 2009, and May 1, 2010, has been extended one year.

Taxpayers can claim the credit on their federal income tax returns. If the credit exceeds their tax bill, the government will issue a check. Taxpayers will be able to claim the credit on their 2009 income tax return for purchases made in 2010.

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Buyer Assistance, For Buyers, For Sellers
Tagged: , , , , , , ,
Residential Brokerage

New-Home Sales Decline

November 2, 2009 by Elliott Robinson · Leave a Comment 

After increasing for five consecutive months, new-home sales declined 3.6 percent in September compared with August to a seasonally adjusted annual rate of 402,000, the Commerce Department reported yesterday.

Sales were down 7.8 percent compared to September 2008.

Most of the decline was in the West and the South, where sales fell 11 percent and 10 percent respectively. These reduction were offset by transactions in the Midwest, where sales jumped 34 percent.

Analysts were surprised by the decline, and some blamed it on the first-time home buyer tax credit, which sucked up customers eager to buy foreclosure bargains. Others said that the new normal for time between signing the sales contract and closing is two months or longer, a reality that could be reflected in these numbers.

“We don’t know yet if it’s anything more than a blip,” says Steven Ricchiuto, an economist for Mizuho Securities USA.

Source: Washington Post, Renae Merle (10/29/2009)

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
(404) 431-2117
Web: www.elliottyouragent.com
Blog – www.elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: For Buyers, For Sellers
Tagged: , , , , , , ,
Residential Brokerage

10 Markets Where Building Is Booming

September 22, 2009 by Elliott Robinson · Leave a Comment 

The building business—both commercial and residential—is a seeing a recovery in some markets, especially those where military, government, and energy jobs are driving demand.

Lake Charles, La., which leads the nation, is an anomaly—it’s recovering from hurricanes—but the other markets are largely driving by economic growth. For instance, building permits for apartments in Huntsville, Ala., near the expanding U.S. Space & Rocket Center, have jumped 400 percent so far in 2009.

Many of the contracts are going to smaller local builders, but some of the giants are getting back in the game as well. KB Home resumed construction in the Mid-Atlantic, including Washington D.C., after pulling back earlier this year.

The top 10 growth markets, based on building permits, are:

1. Lake Charles, La., 122.5 percent
2. Beaumont-Port Arthur, Texas, 65.8 percent
3. Salt Lake City, 36.6 percent
4. Huntsville, Ala., 30 percent
5. Jacksonville, N.C., 28.6 percent
6. Augusta-Richmond County, Ga.-S.C., 21.6 percent
7. Fayetteville, N.C., 12.2 percent
8. Las Cruces, N.M., 11.6 percent
9. Auburn-Opelika, Ala., 11.3 percent
10. Little Rock-North Little Rock, Ark., 7.7 percent

Source: BusinessWeek, Prashant Gopal (09/18/2009)

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: Commercial, For Buyers, For Sellers, Top 10 List
Tagged: , , , , , , , , , , , , , , , , , , , , ,
Residential Brokerage

Mortgage Fraud Keeping FBI Busy

September 20, 2009 by Elliott Robinson · Leave a Comment 

The Federal Bureau of Investigation has more than 2,600 open cases of mortgage fraud, FBI Director Robert Mueller told Congress on Wednesday. Most of the cases involve losses of more than $1 million.

More than 300 special agents are assigned to mortgage fraud, which is up more than 200 percent from what it was three years ago, according to the FBI.

“The schemes have evolved with the changing economy, targeting vulnerable individuals, victimizing them even as they are about to lose their homes,” Mueller said in prepared remarks to the Senate Judiciary Committee.

Source: Reuters News (09/16/2009)

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: For Buyers, For Sellers
Tagged: , , , , , , , , , , ,
Residential Brokerage

Mortgage Demand Down as Summer Ends

September 19, 2009 by Elliott Robinson · Leave a Comment 

Mortgage applications slowed as summer ended and potential first-time buyers wondered whether they would be able to settle in time to receive the federal home ownership tax credit, which expires Dec. 1.

The Mortgage Bankers Association index declined 8.6 percent last week on a seasonally adjusted basis, including an adjustment for the Labor Day holiday. On an unadjusted basis, the index declined 18.3 percent compared with the previous week and fell 18.7 percent compared with the same week a year ago when the Labor Day holiday fell nearly a week earlier.

Mortgage interest rates movements were as follows:

* 30-year fixed-rate mortgages increased to 5.08 percent from 5.02 percent.
* 15-year fixed-rate mortgages decreased to 4.41 percent from 4.45 percent.
* 1-year ARMs decreased to 6.61 percent from 6.69 percent.

Source: Mortgage Bankers Association (09/16/2009)

——————–
Elliott Robinson, JD – Associate Broker
Keller Williams Realty Metro Atlanta
315 West Ponce de Leon Ave., Ste. 100
Decatur, GA 30030
o- (404) 564-5560
Blog – http://elliottonrealestate.com
Twitter – http://twitter.com/elliottrob

Filed Under: For Buyers, For Sellers
Tagged: , , , , , , , ,

Next Page »

elliottonrealestate.com