Why do they wait until the last minute and drive everyone crazy? Is this the way to rebuild a failing economy? Holy cow!
The extension apparently was “cut out” of the main bill and approved by the House AGAIN. Now it goes to the Senate and hopefully they will act promptly to extend this deadline.
House Republicans ganged up on important legislation aimed at extending unemployment to millions of Americans. Included in that legislation was an extension of the closing deadline to obtain the Homebuyer Tax Credit.
Last week the Senate approved the legislation and sent it to the house for approval.
The Homebuyer Tax Credit—for those qualified Homebuyers who signed a contract of sale by April 30th—requires Homebuyers to close on those purchases by June 30th. Last week’s Senate approval would have extended the closing deadline to September 30th, thus giving harried Homebuyers struggling with onerous Lender underwriting processes sufficient time to close and obtain the credit.
The Republican shutdown of this piece of legislation closes the door on many otherwise qualified Homebuyers from obtaining the Tax Credit.
The United States Senate has approved an extension for closing through September 30th. Homebuyers who signed a contract to purchase before April 30th to qualify for the Homebuyer Tax Credit can breathe a sigh of relief. The mortgage lending process can be a slow-moving behemoth, and Lenders have been inundated with loan applications due to the tax credit purchase phenomenon.
Now Buyers who signed on time to qualify for the credit have until September 30th to close on the transaction.
The measure now will move on to the House and ultimately to the President for his signature.
Read more here
Thanks to Carolyn Romberg of Corcoran Group for the link.
Reuters reports that Senate Leader Harry Reid is proposing an amendment to extend the closing deadline from June 30th to September 30th for those homebuyers qualifying for the Homebuyer Tax Credit who signed contracts to purchase prior to the April 30th deadline. This would be welcome news as many folks in process to obtain loan approvals and closing dates are experiencing anxiety due to the slow processing times at many lenders.
CNNMoney.com reports that two other Senators, Sen. Johnny Isakson, R-Ga., and Sen. Chris Dodd, D-Conn. support Senator Reid in his efforts to extend the deadline. According to CNNMoney.com, “The senators said they want to make sure banks have time to process the transactions — especially short-sales, which is a more involved process.”
According to MarketWire.com, the National Association of Realtors commends the Senators for offering to extend the deadline.
More information here thanks to Reuters.
Processing time for mortgage loan applications here at PowerHouse Solutions currently run substantially faster than industry standards due to our experienced operations staff and a commitment to a high level of client service.
Our friend Joseph Paldino, CPA, visits the PHS blog today with information about those “other” tax credits that most homebuyers and homeowners may not be aware of.
Hey Joe!
Qualified first time home buyers have until April 30 to enter into a binding contract for the purchase of a new home. Then you must close by June 30 in order to take the credit.
However, this is not the only credit available to home owners. There are two additional credits available to all homeowners: (1) the nonbusiness energy property credit and (2) the residential energy efficient property credit.
Nonbusiness energy property: credit is available for improvements made to a principle residence located in the United States. The credit is 30% of the cost of qualified improvements with an overall limitation of $1,500. Qualified improvements include the cost of insulation, exterior windows including skylights, exterior doors, certain metal and asphalt roof, energy-efficient heat pumps, water heaters, furnaces, water boilers and central air conditioners. These improvements must meet specified energy-efficiency standards in order to qualify. You may rely on the manufacturers’ written certification that their products meet the standards. You do not need to attach the certification to the tax return but you will need to retain it with your tax records.
Residential energy efficient property: a 30% credit is allowed for the cost of qualified residential solar panels, solar water-heating equipments, geothermal heat pumps and wind turbines. There is no dollar limit on the 30% credit and the property does not need to be your primary residence. The credit is not allowed for the cost of heating a swimming pool or hot tub.
There is also a 30% credit for qualified fuel cells property. The property must be a primary residence located in the United States. The 30% credit is subject to a limit based on kilowatt capacity. The fuel cell property must have a capacity of at least one-half kilowatt of electricity and cannot exceed $500 for each half-kilowatt of electric capacity generated.
Both credits are claimed on Form 5695.
For a free PDF brochure on the advantages of home ownership email your request to Info@jpalcpa.com be sure to include a return email address.
Joseph Paldino has been a Certified Public Accountant since 1991 and has maintainted his own practice for 16 years in Mammaroneck, New York. Joe believes in the “personal touch” with each and every one of his clients, “Success starts with a handhsake,” Joe is fond of saying. You can find Joe through his website HERE.
When you call Joe for tax advice, tell him PHS sent you!
Daylight Savings Time is this weekend: Spring Ahead and set your clocks Forward 1 Hour!
April 30th is the deadline to find a house, sign a contract and qualify for the Refundable Tax Credit for First AND Second Time Homebuyers!
More information HERE
If you purchased a house in 2009 and you’re a First Time Homebuyer and you’re qualified for the refundable First Time Homebuyer Tax Credit, here are the simple steps you must take to claim your money from Uncle Sam:
1. File your 2009 Federal Tax return.
2. Attach IRS Form 5405.
3. Attach your HUD-1 Closing Settlement Statement.
Here’s a link to the IRS website with more details.
If you have already filed your 2009 tax returns and you sign a contract to buy a house by April 30th, 2010 (and subsequently close no later than June 30th, 2010) you can still apply for the refundable tax credit this year. Yes, that’s correct, you don’t have to wait for the filing of your 2010 tax returns to claim the credit! You can simply file an amendment to your 2009 tax returns using form 1040X, attach the IRS Form 5405 and your HUD-1 Closing Statemnt and you’re good to go! You’ll receive your check this year, instead of next! Not too shabby!
The Refundable Tax Credit of $8,000 OR $6,500 CASH MONEY from Uncle Sam is going to expire soon! TO qualify for this sizeable refund from the government just for buying a home you must have signed a contract to purchase by April 30th of this year. You must close by June 30th.
That means if you’re not out shopping for your home now, you need to get prequalified for mortgage financing and get on out there because time is running out!
It takes time to find a house and then negotiate with the Seller on the terms of your purchase. Then you have to wait while an attorney prepares a contract of sale and sends it over to your attorney. These things all take time and you don’t want to be caught waiting for the Seller to agree to your counter offer of $5,000 more or for his attorney to decide to type up a contract when WHAM! The Deadline hits and you’ve missed your chance for Cash Money from the government!
The tax Credit is $8,000 for qualified First Time Homebuyers and $6,500 for qualified second time buyers.
Jump on it! Shop NOW!
As Tax Time approaches and folks await the arrival of their annual W-2 forms, we here at PHS thought we’d remind you a most important factoid of The Homeownership Experience: when you own your own home, the mortgage interest you pay and the property taxes you pay are (in most cases) tax deductible against your income. What does this mean in plain English (or Spanish)? WHEN YOU OWN YOUR OWN HOME YOU PAY LESS INCOME TAX EVERY YEAR (CUANDO TIENE SU PROPIO CASA VAN A PAGAR MENOS EN LOS TAXES FEDERAL CADA ANO)!!!
Amazing but true: The Homeownership Experience helps you to pay less money every year to good Ol’ Uncle Sam. This is why you will often hear real estate professionals tell you that owning is cheaper than renting.
So, as you prepare for Tax Time 2010, for that sweaty-palmed meeting with your tax professional, remember to ask her how much money you would save if you owned a house. You will be very surprised by the answer, we’ll bet!
For the Latest News on the Tax Benefits of The Homeownership Experience, contact a PHS Solutions-Provider today.
Below you’ll find a link to the IRS page outlining the specifics of the refundable tax credit. The $8,000 refundable tax credit is real cash and is available to qualified First Time Homebuyers who purchase a home through April 30, 2010. You must enter into a contract to purchase by April 30th and close on the transaction by June 30, 2010.
You are considered a First Time Homebuyer if you have not owned your primary residence for the past three years up to the date of purchase of your new home.
There’s good news for existing homeowners, too. The new law also provides a “long-time resident” credit of up to $6,500 to people who do not qualify as “first-time homebuyers.” To qualify this way, a buyer must have owned and used the same home as a principal or primary residence for at least five consecutive years of the eight-year period ending on the date of purchase of a new home as a primary residence.
So, good news all around for homebuyers. Rates are still low and there’s plenty of housing “inventory” out there. All that’s left to do is to get prequalified for your mortgage loan and go out shopping for your new home!
Here’s the link to the IRS website: First-Time Homebuyer Credit
Start the New Year right: Go on out and Buy A HOME!
