As agents we are no being asked "What is this tax credit for first time home buyers?" Especially now that there are great prices and low interest rates.
Here is some great in formation I got from my Title agent at Commonwealth Tile and Escrow.
• The tax credit is available for first time home buyers only(or for those who have not purchased in the last three years.)
• The tax credit does not have to be repaid.
• The tax credit is equal to 10% of the home's purchase price up to a maximum of $8,000.
• The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.
• Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.
Frequently Asked Questions
Who is eligible to claim the tax credit?
First-time home buyers purchasing any kind of home-new or resale-are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner.
What is the definition of a first-time home buyer?
The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse. For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first-time home buyer tax credit. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first time buyer, such as may occur if a parent jointly purchases a home with a son or daughter. Ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer.
Are there any income limits for claiming the tax credit?
The tax credit amount is reduced for buyers with a modified adjusted gross income (MAGI) of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint return. The tax credit amount is reduced to zero for taxpayers with MAGI of more than $95,000 (single) or $170,000 (married) and is reduced proportionally for taxpayers with MAGIs between these amounts.
How is this home buyer tax credit different from the tax credit that Congress enacted in July of ‘08?
The most significant difference is that this tax credit does not have to be repaid. Because it had to be repaid, the previous "credit" was essentially an interest-free loan. This tax incentive is a true tax credit. However, home buyers must use the residence as a principal residence for at least three years or face recapture of the tax credit amount. Certain exceptions apply.
How do I claim the tax credit? Do I need to complete a form or application?
Participating in the tax credit program is easy. You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on Line 69 of their 1040 income tax return. No other applications or forms are required, and no pre-approval is necessary. However, you will want to be sure that you qualify for the credit under the income limits and first-time home buyer tests.
What types of homes will qualify for the tax credit?
Any home that will be used as a principal residence will qualify for the credit. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats. The definition of principal residence is identical to the one used to determine whether you may qualify for the $250,000 / $500,000 capital gain tax exclusion for principal residences.
I read that the tax credit is "refundable." What does that mean?
The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayer a check for a portion or even the entire amount of the refundable tax credit. For example, if a qualified home buyer expected, notwithstanding the tax credit, federal income tax liability of $5,000 and had tax withholding of $4,000 for the year, then without the tax credit the taxpayer would owe the IRS $1,000 on April 15th. Suppose now that the taxpayer qualified for the $8,000 home buyer tax credit. As a result, the taxpayer would receive a check for $7,000 ($8,000 minus the $1,000.)
When you want to look for a home, just give me a call.
Bill
Friday, April 3, 2009
Thursday, October 9, 2008
The End of Google, Yahoo and MSN?
The End of Google, Yahoo and MSN?“Those who cannot learn from history are doomed to repeat it.” George Hegel
It’s 1978, Communications 101 at the University of Washington. The history of communication is all of one chapter in a very large text book. It begins with the first printing press, ends with network Television. The next big technology wave was the coax cable. I can still see my professor pacing the classroom with a two foot section of the flexible black rod, pointing it at us, bellowing “This is the future!” He looked like a nun about to rap our knuckles. But 30 years ago, it was the future, and he wanted to make a point: Think Outside the Box.
The Big Four. You think I’m talking about Google, Yahoo, MSN and what’s its name. No, I’m going back in history to the beginning of the technological revolution to the four dominant radio networks. Here is where this history lesson starts.
The history of Radio is complicated but at one time there was NBC, ABC, CBS and the Mutual Broadcasting networks. They were huge in both audiences and cash flow. The Big Four fought it out over the airwaves, in court, and, of course, in advertising, until television took over in the 50’s. However, the change to that new Box took decades.
In 1926, Philo T Farnsworth invented television in his small apartment, all the while, his wife complaining about the smell generated by the tubes. She may have been the first one to say “Television Stinks.” His grandson is a friend of mine so I like to give Philo some credit. The first 60 line image transmitted was a dollar sign, not Philo’s wife.
This is not his wife. I inserted this picture to keep your interest. TV debuted in the United States at the 1939 New York World’s Fair. It wasn’t until after WW II that the economics of television made sense.
As we race through history, The Big Four Radio Networks became the Big Three in television. Even though the Mutual radio network created some of the most formidable radio shows that later became TV shows, it never became a TV network. As the radio networks fizzled, dozens of smaller radio networks and independents were created. The Box was changing.
In the mid 50s, Network TV was sizzling as radio cooled. The Big Three TV Networks had a “License to Print Money.” (A quote from a friend’s dad who ran a large corporation while his wife’s family owned several TV stations.) It was true. The three networks were the only game in town until the mid 80’s.
Network TV changed at the 1986 National Association of Broadcasters convention in San Francisco. I was there, promoting a Gardening show (I’m always a little ahead of my time.) Several blocks down the street, and way off the convention floor, at the elegant Saint Francis hotel was a party launching a new television network: FOX.
The party was packed and the programming was questionable. Everything and everybody was negative about this new start up. FOX promoted the Joan Rivers show. They had the Tracey Ullman show which had a short animated sketch called The Simpson’s. Married with Children, and A Current Affair seemed odd against the Big Three favorites such as The Cosby Show, Family Ties, Dallas and Cheers. But, of course, these and other FOX shows would change communications history; change the Box.
At the party, most of the FOX executives used some kind of gel to slick their hair back and I remember thinking they all looked like car salesmen. But the food and drinks were good and I walked away confident my show had a much better chance than this new network. Twenty years later this start up network became a power house. In the 2007–08 season, Fox became the most popular network in America.
But, back to my point, the big change came in the 80’s as more and more targeted networks challenged convention, challenged the Box. Slowly, CNN, MTV, ESPN, Nickelodeon, HGTV, etc. captured more and more of the Big Three’s audience.
Remember history. There was a time when there were no cable networks. I still see that coax cable pointed in my direction. So, history repeats itself. Radio became TV and now TV becomes the Internet. All had dominate players that shrank, as the economics and media transformed, into other entities.
Google, Yahoo and MSN are called the Big Three search engines today but really they are the Big Three networks (portals.) As ABC, NBC and CBS were in the 50’s to the 80’s, Google, MSN, and Yahoo are the networks of today. It seems obvious when you see these Big Three in a historical perspective, they will go the way of the radio and TV networks.
Today it seems these Big Three struggle to find themselves. I feel like Google is more interested in selling me something than getting me to the right web site. Tomorrow, established and new search engines will become more accepted and useful for view/users to access the internet, the new Box.
In the future, we will look back on the Big Three like we look back on the Big Three TV Networks and before that the Big Four Radio Networks. Perhaps it will take a perceptual or paradigm shift. Or just a new generation; a new wave.
The New History Book: When the new wave thinks rock and roll, they now go outside the Box to MTV.com to search… instead of Yahooing, Goggling, or just feeling lucky.
As we race through history, The Big Four Radio Networks became the Big Three in television. Even though the Mutual radio network created some of the most formidable radio shows that later became TV shows, it never became a TV network. As the radio networks fizzled, dozens of smaller radio networks and independents were created. The Box was changing.
In the mid 50s, Network TV was sizzling as radio cooled. The Big Three TV Networks had a “License to Print Money.” (A quote from a friend’s dad who ran a large corporation while his wife’s family owned several TV stations.) It was true. The three networks were the only game in town until the mid 80’s.
Network TV changed at the 1986 National Association of Broadcasters convention in San Francisco. I was there, promoting a Gardening show (I’m always a little ahead of my time.) Several blocks down the street, and way off the convention floor, at the elegant Saint Francis hotel was a party launching a new television network: FOX.
The party was packed and the programming was questionable. Everything and everybody was negative about this new start up. FOX promoted the Joan Rivers show. They had the Tracey Ullman show which had a short animated sketch called The Simpson’s. Married with Children, and A Current Affair seemed odd against the Big Three favorites such as The Cosby Show, Family Ties, Dallas and Cheers. But, of course, these and other FOX shows would change communications history; change the Box.
At the party, most of the FOX executives used some kind of gel to slick their hair back and I remember thinking they all looked like car salesmen. But the food and drinks were good and I walked away confident my show had a much better chance than this new network. Twenty years later this start up network became a power house. In the 2007–08 season, Fox became the most popular network in America.
But, back to my point, the big change came in the 80’s as more and more targeted networks challenged convention, challenged the Box. Slowly, CNN, MTV, ESPN, Nickelodeon, HGTV, etc. captured more and more of the Big Three’s audience.
Remember history. There was a time when there were no cable networks. I still see that coax cable pointed in my direction. So, history repeats itself. Radio became TV and now TV becomes the Internet. All had dominate players that shrank, as the economics and media transformed, into other entities.
Google, Yahoo and MSN are called the Big Three search engines today but really they are the Big Three networks (portals.) As ABC, NBC and CBS were in the 50’s to the 80’s, Google, MSN, and Yahoo are the networks of today. It seems obvious when you see these Big Three in a historical perspective, they will go the way of the radio and TV networks.
Today it seems these Big Three struggle to find themselves. I feel like Google is more interested in selling me something than getting me to the right web site. Tomorrow, established and new search engines will become more accepted and useful for view/users to access the internet, the new Box.
In the future, we will look back on the Big Three like we look back on the Big Three TV Networks and before that the Big Four Radio Networks. Perhaps it will take a perceptual or paradigm shift. Or just a new generation; a new wave.
The New History Book: When the new wave thinks rock and roll, they now go outside the Box to MTV.com to search… instead of Yahooing, Goggling, or just feeling lucky.
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