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Update to Home Buyer Tax Credits

April 15th, 2010 3:45 PM

$8,000 First Time Home Buyer tax Credit ending on April 30^th

However, the “governater” doesn’t want the fun to stop yet, so he is introducing another credit just for California. Actually, if you time it right, you can take advantage of both and make it an $18k tax credit.

$18,000 IN COMBINED HOMEBUYER TAX CREDITS FOR A LIMITED TIME

Californians have a brief window of opportunity to receive up to $18,000 in combined federal and state homebuyer tax credits. To take advantage of both tax credits, a first-time homebuyer must enter into a purchase contract for a principal residence before May 1, 2010, and close escrow between May 1, 2010 and June 30, 2010, inclusive.

Credit #1:

FEDERAL-First-Time Home Buyer Credit Ending April 30, 2010; Some Current Homeowners Now Also Qualify

To take advantage of this you MUST go into contract by April 30, 2010 and close before June 30, 2010.

The Worker, Home Ownership, and Business Assistance Act of 2009 extends the deadline for qualifying home purchases from Nov. 30, 2009, to April 30, 2010. Additionally, if a buyer enters into a binding contract by April 30, 2010, the buyer has until June 30, 2010, to settle on the purchase.

The maximum credit amount remains at $8,000 for a first-time home buyer –– that is, a buyer who has not owned a primary residence during the three years up to the date of purchase.

But the new law also provides a “long-time resident” credit of up to $6,500 to others who do not qualify as “first-time home buyers.” 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.

For all qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 tax returns.

For info click here: http://www.irs.gov/newsroom/article/0,,id=215791,00.html

Credit #2:

CALIFORNIA-Important Update (03/30/10): The 2010 First-Time Buyer Credit begins May 1, 2010.

If you don’t make it in time Gov. Arnold Schwarzenegger just released a new CA tax credit.

Under the provisions, the bill:

Provides a 5% tax credit, up to a $10,000 tax credit payable over 3 years
New-home buyers have until Dec. 31 to sign a purchase contract, then must close escrow by Aug. 16, 2011.
Requires buyers to live in the home for at least two years.
Sets no income limitations on buyers.
Requires buyers to repay the tax if they fail to live in the home for two years or fail to close escrow on a new home by Aug. 16, 2011.
Funds are first come first serve

For more info click here: http://www.ftb.ca.gov/individuals/New_Home_Credit.shtml

Posted by Gabe Bodner on April 15th, 2010 3:45 PMPost a Comment (0)

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Federal Reserve's Statement On Interest Rates

April 28th, 2010 3:45 PM

DJ Text Of Federal Reserve's Statement On Interest Rates

The statement of the Federal Open Market Committee on April 28, 2010:
"Information received since the Federal Open Market Committee met in March suggests that economic activity has continued to strengthen and that the labor market is beginning to improve. Growth in household spending has picked up recently but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit. Business spending on equipment and software has risen significantly; however, investment in nonresidential structures is declining and employers remain reluctant to add to payrolls. Housing starts have edged up but remain at a depressed level. While bank lending continues to contract, financial market conditions remain supportive of economic growth. Although the pace of economic recovery is likely to be moderate for a time, the Committee anticipates a gradual return to higher levels of resource utilization in a context of price stability.
"With substantial resource slack continuing to restrain cost pressures and longer-term inflation expectations stable, inflation is likely to be subdued for some time.
"The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. The Committee will continue to monitor the economic outlook and financial developments and will employ its policy tools as necessary to promote economic recovery and price stability.
"Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; James Bullard; Elizabeth A. Duke; Donald L. Kohn; Sandra Pianalto; Eric S. Rosengren; Daniel K. Tarullo; and Kevin M. Warsh. Voting against the policy action was Thomas M. Hoenig, who believed that continuing to express the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted because it could lead to a buildup of future imbalances and increase risks to longer-run macroeconomic and financial stability, while limiting the Committee's flexibility to begin raising rates modestly.
"In light of improved functioning of financial markets, the Federal Reserve has closed all but one of the special liquidity facilities that it created to support markets during the crisis. The only remaining such program, the Term Asset-Backed Securities Loan Facility, is scheduled to close on June 30 for loans backed by new-issue commercial mortgage-backed securities; it closed on March 31 for loans backed by all other types of collateral.

Posted by Gabe Bodner on April 28th, 2010 3:45 PMPost a Comment (0)

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