The Federal Tax Credits Blog

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Question: Another question about the $6500 tax credit…?

One question that I have been unable to find the answer to is…
How long will you be required to maintain the new residence as your primary home after purchasing? Or is there any provision in place?

A friend that took advantage of the $8000 the 1st go round said he had to stay in his house 3yrs I think? Would like to know if I will be in the same boat if I take advantage of the new $6500 credit.

Answer: I think it is now 5 years but it still may be 3 years. Look it up at the IRS.GOV

GM looks to banks to secure line of credit

General Motors plans to file its initial public offering in mid- August, sources familiar with the situation said Friday. GM is also in talks with banks for a revolving credit line worth $5 billion, sources said.[...]

First Time Home Buyer Tax Credit Information, 6500 Tax Credit

Question: What Are Some Pros and Cons of Different Organizations that Assist With Purchasing Renewable Energy Credits?

There are two organizations that I have been considering: 1) LiveNeutral (www.liveneutral.org); and 2) Native Energy (www.nativeenergy.com).

Some issues that I am considering are: 1) non-profit vs. for-profit; 2) credits purchased from the Chicago Climate Exchange (CCX) vs. credits created from renewable energy sources; 3) “imaginary” market vs. real-world projects; and 4) managed by educational institution vs. managed by Native American organization. Please feel free to suggest additional criteria.

Also, if there is another organization that you think I should consider, please let me know, and please provide your reasoning for the suggestion.

Thanks!

Answer: There is a table from the Dept. of Energy that compares various vendors and their costs. See:

http://www.eere.energy.gov/greenpower/markets/certificates.shtml?page=1

In effect, you are donating money to fund alternative energy sources (wind, solar, hydro, biogas) that subsequently feed into the nat’l power grid.

Since you are donating money, you might as well get a charitable deducation on your income taxes. The nativeenergy.com site won’t give a definitive answer on this question, but suggests you can do it.

So go with a group which is a charitable non-profit organization that clearly states donations are tax deductible. Look at your yearly electricity bills, multiply kilowatt hours by 2 cents and donate that much.

Unlike the carbon offset credits that are often nebulous and sometimes outright fraudulent, renewable Energy Credits (RECs) trace back to definite generating capacity that can be (and usually are) audited to make sure they are above board. (The US gov’t buys RECs, so any egregious fraud tends to get uncovered quickly.)

I think you are taking the right approach to renewable energy, and these projects will stand the test of time regardless of how the global warming issue pans out.

Despite all the bashing of the US, the graph at:

http://www.eea.europa.eu/pressroom/newsreleases/GHG2006-en

shows how the EU-25 don’t come close to meeting their Kyoto promises.

The non-Kyoto country, the US, in 2006 DECREASED CO2 emissions in by 1.4%.

I guess that signing Kyoto and then reneging somehow makes countries feel noble and good about themselves. But buying RECs that actually do something doesn’t count.

UPDATE:Obama Highlights Efforts To Unleash Private-Sector Growth

UPDATE:Obama Highlights Efforts To Unleash Private-Sector Growth

Gains from an integrated market for tradable renewable energy credits [An article from: Ecological Economics] $8.95 This digital document is a journal article from Ecological Economics, published by Elsevier in 2004. The article is delivered in HTML format and is available in your Amazon.com Media Library immediately after purchase. You can view it with any web browser.Description: Decoupling the environmental attributes of renewable energy (RE) generation from the physical unit of energy is an innovative mecha…

Law 270.6 – Lecture 9 – Resource Alternatives: Renewable Energy – The Technologies

Question: Filing married for first time, husband in Army, i worked only 2 months from oct – dec 08, bought a house and?

a rv. bought the house in july 08, the rv in dec 08. im a german national and didnt have a ssn until august, then started working in oct-dec, i only paid 68 cent in state taxes haha. husbands fed taxes withheld were 1843.42, he claims 0. we got married in 07 but couldnt file together as i had no social yet. we paid 333.86 in county taxes for the house and 3427.18 in interest in 2008. we already know what we are getting back in state taxes for him, we assume i might have to pay. we also bought a new car in april/may 08, purchased on army post. we have made some home improvements (tile in dining room, patio in back, porch in front) have the receipt. what about the first time home owner credit for 7500? our 10% would be way over that so we would get the 7500 so..any estimates on how much we would get back in fed taxes or in general? thank you to whoever will answer

Answer: you are definitely going to want to talk to a professional. you have several different issues to talk about….

first: you could have filed married for 2007. you would have filed a paper return, but it would have given you a higher standard deduction. all you would have had to do is put ‘applied for’ in the part that asks for your ssn. i suggest you go back and amend the 2007 return and file married filing joint.

second: the house and the RV will prove advantageous for you this tax season. it will give you the opportunity to itemize which could be very good for you. buying the new car could help too, but a tax professional will know exactly what works for your situation.

third: the home improvements won’t be of any use until you guys sell your house. definitely keep your receipts because it will help if and when you sell the house.

In order to give you an accurate answer on what you would get back you would have to give us WAY more information… but I strongly suggest you ask around and find a tax preparer that you can go to and talk to them about all this.

if you don’t feel you can afford something like that you can always look into TurboTax. Its very easy to use and guarantees the highest refund you could get, legally. This website offers 20% off Turbo Tax. http://turbotax.intuit.com/affiliate/intuitrefer

Good Luck!!

IBM to get nearly $8M tax rebate for 600 NC jobs

RALEIGH, N.C. (AP) – An IBM Corp. subsidiary will hire 600 workers at its North Carolina campus over the next two years and could get a tax rebate of nearly $8 million while paying wages below the local average.

New Car Buyer’s Deduction

Question: I got screwed out of my stimulus because I am over 17 make over 3k but I’m claimed from my parents.?

My parents claimed me while I am in college to try to get a tax break…I am 21 years old have my own home which I have a mortgage for…I go to school 20 credit hours in college and work 42 hours full time job and make over 3k per year. I got screwed out of my Stimulus when college kids trying to save for their tuition and still try to have a life should get this money!! I work hard!!
I am on good terms with my parents. And well I mean my parents did pay for everything when I was a child and middle school and until I was old enough to get a job … so I think I would feel guilty to ask for it ya know??
And saying my parents did it for a tax break sounds bad… I didn’t mean it like they are swindlers. Most people claim their children through college so its not like a “tax break” as I called it.

Answer: The parents do NOT get any extra for a college kid on their stimulus because you don’t get it for dependents over 17. So where does these kids 300.00 go? The parents get a break on their actual taxes but nothing extra on their stimulus.

Obama continues touting tax credits for clean-energy manufacturing

President Barack Obama wrapped a two-day sales pitch for his administration’s economic policies by pushing for a $5 billion expansion of tax credits for clean-energy manufacturing, an industry that recession-worn Nevada has clung to as a potential lifeline.

The Earned Income Tax Credit Obamas Stimulus Welfare Scam

Question: What is the best way to start the home buying process for first time buyers with little or no credit?

I live in GA and I am looking for a home in Douglasville. How do I start the loan approval process?

Answer: In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, which you can find one in your local telephone book.

Make sure this mortgage broker or mortgage banker is able to do government loans such as FHA and VA loans if you qualify for one.

He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores. These credit scores will determine your interest rate.

The amount of your monthly debt payments you are required to pay as per your credit report and the amount of mortgage you can take on based on your income will determine the amount of house you will be able to purchase.

When you speak with the mortgage broker you will need the following documents to complete the loan application, there will be others, but this will get you started.

#1 One month of pay stubs for each person that will be on the mortgage.

#2 Six months bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.

#3 Two years of federal income tax along with the W-2 that match.

Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home. In this pre-approval letter will be the amount of house you are qualified to purchased.

Once he gives you this pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.

Now make sure before you get your pre-approval you and your mortgage broker go over all your options as to the mortgage programs you qualify for, the interest rate, monthly payments.

If you are getting a FHA, fixed rate, two loans to eliminate PMI like an 80/20 or one loan, if you are qualified for and approved for a 100% loan.

You should select the loan that best suit your financial condition at the time. That could be an adjustable rate loan. It could be a fixed rate loan for 5 or 10 years and then adjust. Some adjustable rate mortgages only adjust once.

Make sure your mortgage broker explain all your options so you may make an intelligent decision.

What might be good for one person might not be good for you, in other words just because your friends and all your real estate buddies are telling you about the great fixed rate they got, your financial situation might call for something else.

So select the best option for you and your financial situation.

You should also get a Good Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.

Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign.

Your mortgage broker will now order an appraisal to show proof of the property value.

The mortgage broker might ask for additional information or documentation, don’t get all up tight this is normal, just supply the information or find the documents needed.

After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.

Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.

I hope this has been of some use to you, good luck

“FIGHT ON”

The capital conundrum

Although there are plenty of available homes for sale in today’s market, the one type of home that may be difficult to find is a spec home; a brand new home built with no particular buyer in mind. If you ask a builder, he’ll say it’s because the banks aren’t lending money to build spec homes. If you ask a banker, he’ll say it’s because there are no buyers for spec homes and adding more inventory …

Loan Modification – Part 2: Home Mortgage Bailout – Real Estate Foreclosure Prevention Process