Move up / Repeat Home Buyer Tax Credit
Another exciting new tax law for home owners! The Worker, Homeownership, and Business Assistance Act of 2009 has established a tax credit of up to $6,500 for qualified move-up/repeat home buyers (existing home owners) purchasing a principal residence after November 6, 2009 and on or before April 30, 2010 (or purchased by June 30, 2010 with a binding sales contract signed by April 30, 2010). THIS MEANS that even if you don't qualify for the First Time Home Buyer Credit because you have been a homeowner for the past three years, you still have a chance to take advantage of a large tax credit if you want to buy a new home in the next six months. Please see below for questions and answers regarding this new tax credit available:
Q:Who is eligible to claim the $6,500 tax credit?
A:Qualified move-up or repeat home buyers purchasing any kind of home are eligible to claim this credit.
Q:What is the definition of a move-up or repeat home buyer?
A:The law defines a tax credit qualified move-up home buyer (“long-time resident”) as a person who has owned and resided in the same home for at least five consecutive years of the eight years prior to the purchase date. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. Repeat home buyers do not have to purchase a home that is more expensive than their previous home to qualify for the tax credit.
Q:How is the amount of the tax credit determined?
A:The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $6,500. Purchases of homes priced above $800,000 are not eligible for the tax credit.
Q:Are there any income limits for claiming the tax credit?
A:Yes. The income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) above those limits. The phaseout range for the tax credit program is equal to $20,000. That is, the tax credit amount is reduced to zero for taxpayers with MAGI of more than $145,000 (single) or $245,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
Monday, November 23, 2009
First Time Home Buyer Credit Extended to June 30th, 2010
First-Time Homebuyer Credit
Did you think you missed the boat on the first time home buyer credit of $8,000 that was being offered by the IRS until December 1st, 2009? Great news! Homebuyers who purchased a home in 2008, 2009 or 2010 now have until June 30th, 2010 to be eligible for the first-time homebuyer credit. This credit applies to taxpayers who have not owned a home in the past 3 years and who are buying their new home to be used as a taxpayer's principal residence. This credit reduces a taxpayer's tax bill or increases his or her refund, dollar for dollar. It is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed. Check out the article below for full details.
First-Time Homebuyer Credit
IR-2009-103, Nov. 17, 2009: New Legislation
WASHINGTON — New legislation, the Worker, Homeownership and Business Assistance Act of 2009, which was signed into law on Nov. 6, 2009, extends and expands the first-time homebuyer credit allowed by previous Acts. The new law: Extends deadlines for purchasing and closing on a home. Authorizes the credit for long-time homeowners buying a replacement principal residence. Raises the income limitations for homeowners claiming the credit. Under the new law, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2010 and close on the home by June 30, 2010. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. For the first time, long-time homeowners who buy a replacement principal residence may also claim a homebuyer credit of up to $6,500 (up to $3,250 for a married individual filing separately). They must have lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the replacement home is purchased. People with higher incomes can now qualify for the credit. The new law raises the income limits for homes purchased after Nov. 6, 2009. The credit phases out for individual taxpayers with modified adjusted gross income (MAGI) between $125,000 and $145,000 or between $225,000 and $245,000 for joint filers. The existing MAGI phase-outs of $75,000 to $95,000 or $150,000 to $170,000 for joint filers still apply to purchases on or before Nov. 6, 2009. Several new restrictions apply to homes purchased after Nov. 6, 2009. Purchasers must attach a properly executed settlement statement to their return. No credit is available if the purchase price of the home exceeds $800,000. The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement. A dependent is not eligible for the credit. http://www.irs.gov/newsroom/article/0,,id=204671,00.html
Did you think you missed the boat on the first time home buyer credit of $8,000 that was being offered by the IRS until December 1st, 2009? Great news! Homebuyers who purchased a home in 2008, 2009 or 2010 now have until June 30th, 2010 to be eligible for the first-time homebuyer credit. This credit applies to taxpayers who have not owned a home in the past 3 years and who are buying their new home to be used as a taxpayer's principal residence. This credit reduces a taxpayer's tax bill or increases his or her refund, dollar for dollar. It is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed. Check out the article below for full details.
First-Time Homebuyer Credit
IR-2009-103, Nov. 17, 2009: New Legislation
WASHINGTON — New legislation, the Worker, Homeownership and Business Assistance Act of 2009, which was signed into law on Nov. 6, 2009, extends and expands the first-time homebuyer credit allowed by previous Acts. The new law: Extends deadlines for purchasing and closing on a home. Authorizes the credit for long-time homeowners buying a replacement principal residence. Raises the income limitations for homeowners claiming the credit. Under the new law, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence on or before April 30, 2010 and close on the home by June 30, 2010. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. For the first time, long-time homeowners who buy a replacement principal residence may also claim a homebuyer credit of up to $6,500 (up to $3,250 for a married individual filing separately). They must have lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the replacement home is purchased. People with higher incomes can now qualify for the credit. The new law raises the income limits for homes purchased after Nov. 6, 2009. The credit phases out for individual taxpayers with modified adjusted gross income (MAGI) between $125,000 and $145,000 or between $225,000 and $245,000 for joint filers. The existing MAGI phase-outs of $75,000 to $95,000 or $150,000 to $170,000 for joint filers still apply to purchases on or before Nov. 6, 2009. Several new restrictions apply to homes purchased after Nov. 6, 2009. Purchasers must attach a properly executed settlement statement to their return. No credit is available if the purchase price of the home exceeds $800,000. The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement. A dependent is not eligible for the credit. http://www.irs.gov/newsroom/article/0,,id=204671,00.html
Expanded Loss Carryback Option for All Businesses - NEW Legislation
Most Businesses May Take Advantage Of Expanded Loss Carryback Option Under New IRS Procedure
Small Businesses and Big Businesses alike can take part in the cheer this season with a new tax law passed this week. In light of the financial hit taken by businesses in general in the recent economic downturn, the IRS is allowing losses incurred during the economic downturn to reduce income from prior tax years to any taxpayer with business losses. See the article below for more information.
Most Businesses May Take Advantage Of Expanded Loss
Carryback Option Under New IRS Procedure
IR-2009-105, Nov. 20, 2009
IR-2009-105, Nov. 20, 2009
WASHINGTON — Most businesses may use losses incurred during the economic downturn to reduce income from prior tax years, under a revenue procedure issued today by the Internal Revenue Service. The relief provided under the Worker, Homeownership, and Business Assistance Act of 2009 differs from similar relief issued earlier this year in that the previous relief was limited to small businesses. The current relief is applicable to any taxpayer with business losses, except those that received payments under the Troubled Asset Relief Program. The relief also applies to a loss from operations of a life insurance company. Taxpayers under the procedure may elect to carry back a net operating loss (NOL) for a period of three, four or five years, or a loss from operations for four or five years, to offset taxable income in those preceding taxable years. An NOL or loss from operations carried back five years may offset no more than 50 percent of a taxpayer's taxable income in that fifth preceding year. This limitation does not apply to the fourth or third preceding year. The procedure applies to taxpayers that incurred an NOL or a loss from operations for a taxable year ending after Dec. 31, 2007, and beginning before Jan. 1, 2010. http://www.irs.gov/newsroom/article/0,,id=215657,00.html
Tuesday, August 18, 2009
Thursday, August 13, 2009
September 15th - Business Returns DUE
Corporate/LLC/Partnership/Estate&Trust Returns DUE SEPTEMBER 15th!
September 15th is an important date for the IRS, and we want to make sure that you are aware and prepared. Corporate, LLC, Partnership, and Estate/Trust Returns are DUE on September 15th. In previous years the extension date was October 15th, but this year the IRS shortened the filing date by one month effective for 2008. This gives us even less time to prepare, and we want to make sure that we have everything in place to be able to lower your tax liability to the fulllest extent of the law. Also, remember that filing late will incur a penalty charge, so please call or email Fern to set up an appointment at your earliest convenience at office@mbtaxpro.com or (503) 595-5890.
First Time Homebuyer Credit
There is still time to take advantage of the First Time Homebuyer Credit. Qualifying taxpayers who purchase a home before December 1st, 2009 receive a credit of ten percent of the cost of the home purchase up to $8,000 or $4,000 for married individuals filing separately. You can qualify if you have not owned a home in the past three years. You have the option of either amending your 2008 tax return, or claiming the credit on your 2009 tax return. The amended return will allow you to claim the homebuyer credit on the 2008 tax return without waiting until next year to to claim it on your 2009 tax return. Where's My Refund?If you have not received your refund yet, and would like to know the exact date that you might expect it, please go to http://www.irs.gov/ and look at the right side of the home page. There is an icon called "Where's My Refund?" Click on that icon and it will take you to an data input page where you will provide your Social Security Number, your filing status (Filing Single, Head of Household, Married Filing Jointly etc.), and your exact amount of the refund that you expect. After you provide that information you will be taken to a page that tells you exactly the status of your refund, and when you should expect it to be direct deposited or mailed to your home. If you are unsure of the exact amount you are expecting, feel free to call us and we'll let you know.
A Frequently Asked Question
Question: I am starting a small business and would like to get a better understanding of my personal bank account vs. my business account. Which one do I deposit my income into? How much can I transfer to my personal account per month? What kind of expenses are deductible when they are spent from my business account?
Answer: Great question! When you have income to deposit, go ahead and deposit all of it into your business account. That way you have a fast and easy way of seeing exactly how much is coming in every month. Then take out any and all money that you will need for personal expenses (rent/mortgages, food, clothing, personal items, recreation etc.). What is left in your business account will be spent strictly on the business. Some business expenses might be office rent, supplies, networking, advertising, professional fees, business travel costs, insurance, and of course, your business tax preparation! If you would like a copy of our Self-Employed or Small Business Deduction Worksheet, just email or call Fern at the office and she will be happy to email or mail one to you right away.
Thank you for helping to make 2009 one of our best years at MB Tax Professionals. Enjoy your last few weeks of summer, and we'll be looking forward to appointments with many of you soon.
All the best,
MB Tax Professionals
September 15th is an important date for the IRS, and we want to make sure that you are aware and prepared. Corporate, LLC, Partnership, and Estate/Trust Returns are DUE on September 15th. In previous years the extension date was October 15th, but this year the IRS shortened the filing date by one month effective for 2008. This gives us even less time to prepare, and we want to make sure that we have everything in place to be able to lower your tax liability to the fulllest extent of the law. Also, remember that filing late will incur a penalty charge, so please call or email Fern to set up an appointment at your earliest convenience at office@mbtaxpro.com or (503) 595-5890.
First Time Homebuyer Credit
There is still time to take advantage of the First Time Homebuyer Credit. Qualifying taxpayers who purchase a home before December 1st, 2009 receive a credit of ten percent of the cost of the home purchase up to $8,000 or $4,000 for married individuals filing separately. You can qualify if you have not owned a home in the past three years. You have the option of either amending your 2008 tax return, or claiming the credit on your 2009 tax return. The amended return will allow you to claim the homebuyer credit on the 2008 tax return without waiting until next year to to claim it on your 2009 tax return. Where's My Refund?If you have not received your refund yet, and would like to know the exact date that you might expect it, please go to http://www.irs.gov/ and look at the right side of the home page. There is an icon called "Where's My Refund?" Click on that icon and it will take you to an data input page where you will provide your Social Security Number, your filing status (Filing Single, Head of Household, Married Filing Jointly etc.), and your exact amount of the refund that you expect. After you provide that information you will be taken to a page that tells you exactly the status of your refund, and when you should expect it to be direct deposited or mailed to your home. If you are unsure of the exact amount you are expecting, feel free to call us and we'll let you know.
A Frequently Asked Question
Question: I am starting a small business and would like to get a better understanding of my personal bank account vs. my business account. Which one do I deposit my income into? How much can I transfer to my personal account per month? What kind of expenses are deductible when they are spent from my business account?
Answer: Great question! When you have income to deposit, go ahead and deposit all of it into your business account. That way you have a fast and easy way of seeing exactly how much is coming in every month. Then take out any and all money that you will need for personal expenses (rent/mortgages, food, clothing, personal items, recreation etc.). What is left in your business account will be spent strictly on the business. Some business expenses might be office rent, supplies, networking, advertising, professional fees, business travel costs, insurance, and of course, your business tax preparation! If you would like a copy of our Self-Employed or Small Business Deduction Worksheet, just email or call Fern at the office and she will be happy to email or mail one to you right away.
Thank you for helping to make 2009 one of our best years at MB Tax Professionals. Enjoy your last few weeks of summer, and we'll be looking forward to appointments with many of you soon.
All the best,
MB Tax Professionals
Friday, July 10, 2009
Summer Tax Tips
It's that time of the year where the hustle and bustle slows down and we can finally take a moment to enjoy what we have worked so hard for all year long. It's also the time of the year that some of your tax planning may slide, so here are some fun Summer Tax Tips to keep in mind while you work and play.
Summer Camp
Is your child enrolled in a Summer Day Camp? You may be eligible for a tax credit. Many working parents must arrange for summer care for children 13 years and younger. Unlike overnight camps, the cost of day camp may count as an expense toward the Child and Dependent Care Credit.
Summer Cleaning
Summer Cleaning could earn you a tax deduction, as long as you donate items in good condition to a qualified charity. Remember to itemize your deductions and keep proof of all of your donations.
Summer Home
Buying a home this summer? First time home buyers get a credit of up to $8,000 (first time home buyers are those that haven't owned a house in the past 3 years). This credit is good for houses purchased prior to December 1st, 2009.
Summer Job
Any working students at home for the summer? Some things to keep in mind are what status they are employed as and if they will be exempt from withholding. Summer workers are sometimes misclassified as independent contractors (self-employed) rather than as employees. Employers who do this usually fail to withhold taxes from the worker's wages, often leaving the worker responsible at tax time for paying income taxes plus Social Security and Medicare taxes. Pay close attention to this so there are no surprises come tax time. Your working students also may be exempt from withholding if they are claimed as a dependent, their total 2009 income is not over $5,700, or they had no income tax owed for 2008. Feel free to call us at MB Tax Professionals with any tax questions for your working student.
Summer Road Trips
Buying a more fuel efficient car just in time for those long summer road trips? You may be eligible for a tax credit up to $1,800 depending on the make and model just for changing what you drive.
Enjoy your summer and let us know how we can help make 2009 your smoothest tax year yet. Looking forward to working with you soon!
Thursday, June 25, 2009
Luke Cox - Short Sale Professional
Is a Short-Sale the right option for you?
Are you facing foreclosure? Are you unable to sell your home at a price that would cover what you currently owe on your mortgage(s)? I work to negotiate a Short Sale Agreement with your lender, lifting much of the financial burden off your shoulders.
A Short Sale is when your lender agrees to let you sell your home for less than what is owed on your mortgage(s). It is an option to them as an alternative to foreclosure, which is an extremely expensive process for them. I can assist you in supplying the appropriate information to your lender to maximize your results.
I prepare a list of documentation that needs to be completed and turned into the lender that lets them better understand your hardship and shows the current market activity so the lender is up to date with your market conditions.
If any of the following are true to your situation, a Short Sale may be right for you.
1. You lost your job.
2. Your medical expenses are too high.
3. You just went through/are going through a divorce.
4. You are behind on your payments.
5. You have no equity.
6. You can't afford the cost of selling your home.
Call Luke Cox with EXIT Realty, Your Next Move for a free no obligation consultation and find out if a Short Sale is the right option for you.
Luke Cox
Real Estate Broker
ABR, Earth Advantage STAR
CSP - Certified Short Sale Professional
Exit Realty, Your Next Move
503-239-7401 fax
503-516-5282 mobile
luke@lukecox.com
www.lukecox.com
Are you facing foreclosure? Are you unable to sell your home at a price that would cover what you currently owe on your mortgage(s)? I work to negotiate a Short Sale Agreement with your lender, lifting much of the financial burden off your shoulders.
A Short Sale is when your lender agrees to let you sell your home for less than what is owed on your mortgage(s). It is an option to them as an alternative to foreclosure, which is an extremely expensive process for them. I can assist you in supplying the appropriate information to your lender to maximize your results.
I prepare a list of documentation that needs to be completed and turned into the lender that lets them better understand your hardship and shows the current market activity so the lender is up to date with your market conditions.
If any of the following are true to your situation, a Short Sale may be right for you.
1. You lost your job.
2. Your medical expenses are too high.
3. You just went through/are going through a divorce.
4. You are behind on your payments.
5. You have no equity.
6. You can't afford the cost of selling your home.
Call Luke Cox with EXIT Realty, Your Next Move for a free no obligation consultation and find out if a Short Sale is the right option for you.
Luke Cox
Real Estate Broker
ABR, Earth Advantage STAR
CSP - Certified Short Sale Professional
Exit Realty, Your Next Move
503-239-7401 fax
503-516-5282 mobile
luke@lukecox.com
www.lukecox.com
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