The Federal Tax Credits Blog

Archive for December, 2009

Home sales over the past year or so have caused a mixed bag of emotions for many people. Many people have suffered a great deal of stress and anxiety over losing their homes and falling into foreclosure while many others are delighted with having the ability to buy into a market full of discounted homes, foreclosures, and short sales. While it is true that the real estate market is the cause of a lot of heartache for many Americans, it is also the case that the home sales are also helping to prop up a flailing economy this quarter.

The number of home sales has substantially picked up this fall and in fact, October home sales have finished higher than they’ve been in over two years. This is, in a large part, due to the fact that home buyers were racing to beat the expiration of the first time home buyer’s tax credit. Now that this credit has been extended until the end of April, however, we are sure to see another rush to buy when this deadline approaches.

The low mortgage rates have really helped the current trends in home buying. Even with fewer funds to go around, the reduced prices of homes in combination with these lower lender’s rates have created some ideal opportunities for home buyers, particularly those who’re looking to purchase their first home.

If home prices continue to fall, particularly with the home buyer’s tax credit still in place, then the home sales over the fall may just continue to exceed expectations. However, the sales that occur in late in the year tend to drop off in frequency as the weather worsens.

The increase in home sales has certainly helped the economy somewhat, though experts say that it needs support from a wider range of industries before it really starts to recover. With fewer and fewer homes on the market hopefully this will impact the home building industry soon as it is still struggling with a lack of business due to the glut of homes on the market due to foreclosures and short sales.

Hopefully we will see a slow but steady increase in not only home sales, but also a variety of other industries over this winter. The more confidence that we can put in the economy, the more we will benefit from the increased productivity that our dollars stimulate in it. Only time will tell how the economy will withstand the eventual withdrawal of government stimulus though.

Electronics Led Jump in Online Holiday Shopping

More customers chose to point and click rather than park and swipe this Christmas season, with a five percent increase in online shopping over the same period last year, a study by the Internet marketing firm comScore says. By comparison, in-store retail shopping grew only 3.6 percent, according to credit-card spending tracked by Mastercard Advisors’ Spending Pulse.

First Time Home Buyer Loan, $8000 Tax Credit, FHA Low Down Payment Mortgage Assistance Program

Are you lagging behind on your tax payments? Staying up all night thinking about your IRS tax issues? You don’t have to worry since IRS tax debt relief is not hard to avail when you have unintentionally fallen behind on your tax commitments. The IRS has one of the most effective collection methods and you cannot get away without paying what you owe them. But the IRS is not be feared. You can attain tax debt relief by maintaining your composure and acting smartly. You can also opt for professional help. There are many companies that can provide IRS debt help. All you need to do is find the one that best suits you.

You can check the internet. There’s a huge pool of well-reputed and trusted websites that provide IRS tax help. What you actually need is a tax relief attorney. And these companies can provide the required personnel. Many of your tax problems that you thought would never be solved, could be solved within days.

Tax professionals have the required expertise and experience needed to deal with the IRS. They can help you in the following ways:

So you see, getting out of tax problems is not that difficult, if you have the right kind of people on your side.

TAX TIME: April 15 on its way

Just as snows will come in January so will those thick booklets from the IRS sending greetings that …

Recovery: New Homebuyer Credit – November 2009

Question: US Canada taxes?

Hi, my situation is as follows:
- I currently live in Canada and work for a company in the US.
- work from my home in canada and travel to US (MA) for 3 days a month
- pay US federal taxes, but not state taxes

When I filed my taxes in Canada last year I claimed the foreign tax credit for the federal US taxes I paid. However, I am concerned that I should have applied to the US to refund most of the taxes I paid since most of the services I performed were in Canada. Is this what I need to do or do I just claim all of the taxes I paid to the US on my Canadian return?

Thanks.

Thanks for you help.

Answer: You are an employee of an American company, and therefore earn the income outside of Canada. You may do most of the work in Canada, but only because you work from home.

Canada and the US have a tax treaty. That means that you file your return here, and the taxes that you paid in the US count towards the taxes you pay for Canada.

You report your gross income (amount before taxes and income). Then you get a tax credit for the US federal tax that was withheld.

Here’s what the CRA says:
————————————

Line 104 – Foreign employment income

Foreign employment income is income earned outside Canada from a foreign employer. Report this income in Canadian dollars. Use the exchange rate that was in effect on the day you received the income or, if the amount was paid at various times throughout the year, you can use our average annual rate.

Note
U.S. wages reported on a U.S. W-2 slip may be reduced by such contributions to a “401(k), 457 or 403(b) plan, US Medicare and Federal Insurance Contributions Act (FICA)”. These contributions are not deductible on your Canadian return and must be added to your employment income at line 104.

If you paid foreign taxes on foreign income you received, do not reduce the amount you report by the amount of tax the foreign country withheld. However, you may be able to claim a foreign tax credit when you calculate your federal and provincial or territorial taxes. See line 405 – Federal foreign tax credit, for details.

Year-end tax planning can save you money

(Special) – The end of the calendar year often is the time when many Canadians start to think about making resolutions they hope to keep in the New Year. But it’s also a great time to do a little a little tax planning that can help you reduce your tax bills and get your investment portfolios in shape for the coming year.

Tax Credit for Active Kids : Family Tax Preparation Services Canada

Question: Are Fuel Surcharges Taxable?

Some of my vendors tax the recently common fuel surcharge and delivery charge but others don’t. I get conflicting answers from my accountant and the NYS tax website. Do I take it off the invoice when I pay or can I go for a tax credit at the end of the year?

Answer: Fuel surcharges and shipping charges are part of the taxable receipt in NYS if the product sold is subject to sales tax.

Read the link about transportation charges. If the fuel surcharge is not covered by the document below, then it is considered a reimbursable expense which is also added to the taxable receipt.

Studies Find Heavy Heating Oil Has Severe Effect on Air Quality

New York City and an environmental group found high levels of pollutants in neighborhoods where buildings burn No. 4 or No. 6 oil.

THE MOST IMPORTANT VIDEO ON THE INTERNET NO MORE FED RESERVE

The federal tax credit for first-time home buyers is to ensure that home buyers will become home owners utilizing the $8000. Not only will the tax credit help the real estate industry, it will more importantly help increase home ownership.

The tax credit is for home buyers purchasing a new or pre-owned home. To qualify for the tax credit, you must buy the home before May 1, 2010 (with the closing date before July 1, 2010). If you construct your home, the purchase date is the date that you occupy the home. Even if you were a home owner before, you can qualify for the tax credit if you did not own a home within the last 3 years of the purchase date.

For the purpose of the first-time home buyer tax credit, a first-time home buyer is one who is a tax payer that has not owned a principal home at any time during the three years prior to the date of purchase. The income limits for the home buyers: Married couples modified adjusted gross income should be less than or equal to $150,000 and for other tax payers the modified adjusted gross income should be less than or equal to $75,000. This will enable many home buyers to utilize the tax credit to buy Dallas homes for sale in the DFW real estate market.

You can claim the first-time home buyer tax credit, if you obtain the benefits and burdens of ownership, which means you should have the right to possession, the right to obtain legal title upon full payment of the purchase price, the right to construct improvements, the obligation to pay property taxes, the risk of loss, the responsibility to insure the property, the duty to maintain the property.

The tax credit for two unmarried people who buy a house together can be determined through the guidance of IRS. If you are a single co-owner of a home purchased within the tax credit program dates, you can claim the credit on your 2008 or 2009 federal income tax return. The tax credit can be claimed by a home buyer who does not have any taxable income. A first-time home buyer with no taxable income can claim the tax credit.

You do not qualify for the tax credit if you exceed the income limits, buy your home from a close relative, such as spouse, parent, grandparent, child or grandchild, do not use the home as your principal residence, sell your home before the end of the year, are a nonresident alien, you are or were eligible for the District of Columbia home buyer credit (does not apply for a home purchased in 2009), your home financing comes from tax-exempt mortgage revenue bonds or owned a principal residence within the three years of a purchase date of your new Dallas – Fort Worth home in the DFW real estate area.

You should take advantage of the first-time home buyer tax credit and claim the $8,000 incentive on your home purchase in the Dallas – Fort Worth metroplex. You can claim $8,000 and become a home owner.

2009: The year that was

Okanagan-Shuswap MP Colin Mayes says he’s sure that the federal government will survive the presentation of the budget on Jan. 27, by Finance Minister Jim Flaherty. Though the minority Conservative government could fall if the Opposition parties don’t endorse the document, Mayes says the party is putting forth a budget that is good for the country, the House, and the economy. If the non …

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