Posts Tagged ‘tax credit’

Home-Buyer Credit Tempts Tax Cheats

Friday, October 23rd, 2009

This does not help getting an extension for the First Time Home-buyer tax credit.

By MARTIN VAUGHAN and JOHN D. MCKINNON
Tens of thousands of people submitted suspicious — and possibly fraudulent — claims for a federal tax credit meant for first-time home buyers, tax officials told Congress Thursday.

The Treasury tax-oversight office said at least 19,000 filers who hadn’t bought homes claimed $139 million in tax credits and were reimbursed, raising new worries about the housing stimulus as lawmakers consider extending the credit.

Treasury oversight officials said they have found an additional 74,000 tax-credit claims, valued at $500 million, where evidence of previous homeownership could make their claims invalid.

More than 500 people under the age of 18, including a 4-year-old child, also had their names on applications for the credit, which has no minimum-age requirement, federal officials said at a hearing on abuses of the program. Most of the claims involving children were made by parents who purchased a home but were ineligible for the credit because their incomes were too high, said J. Russell George, the Treasury inspector general for tax administration. The tax-oversight office doesn’t answer to the Treasury secretary.

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Will First Time Homebuyer Tax Credit Continue

Tuesday, September 1st, 2009

Lobbying intensifies to extend first-time buyer tax credit

By Kenneth R. Harney

Washington Post Writers Group

August 30, 2009

It’s one of the biggest unknowns bugging would-be buyers of houses and condos this summer: Will Congress let the $8,000 nonrepayable tax credit for first-time purchasers expire as scheduled about three months from now? Or will the credit get a second life and be extended for six to 12 months, taking pressure off buyers, real estate agents and settlement companies?

That’s an especially urgent matter if you’re a buyer just starting to shop and you see entry-level prices bottoming out or rebounding. The tax credit statute requires buyers to fully close on their purchases –– not just be under contract –– no later than Nov. 30. This doesn’t leave a lot of leeway for people who haven’t yet decided on a specific house and who haven’t nailed down mortgage financing.

The whole process of negotiating offers, signing sales contracts, applying for a loan and completing the closing can easily extend for two months –– or a lot more.

Given the rapidly approaching deadline, what’s the likelihood that Congress will blow the whistle and allow at least a little extra time? Though Congress is on its summer break, most members of the Senate and House use part of the August recess to listen to constituents back in their home districts.

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First Time Homebuyers Tax Credit

Thursday, April 9th, 2009

Options for first-time homebuyers to maximize their tax credit

Washington – As part of the Treasury Department’s consumer outreach effort and with the April 15 individual tax filing deadline approaching, the Internal Revenue Service (IRS) has begun a concerted effort to educate taxpayers about additional options at their disposal to claim the new $8,000 first-time homebuyer tax credit for 2009 home purchases.

“The new credit can get money in the pockets of first-time homebuyers quickly,” said IRS Commissioner Doug Shulman. “For people who recently purchased a home or are considering buying in the next few months, there are several different ways that they can get this tax credit even if they have already filed their tax return.”

The Treasury Department encourages taxpayers to explore these options to maximize their credit and get their money back as fast as possible.

Under the American Recovery and Reinvestment Act of 2009, qualifying taxpayers who purchased a home before Dec. 1 receive up to $8,000 or $4,000 for married individuals filing separately. People can claim the credit either on their 2008 tax returns due April 15 or on their 2009 tax returns next year.

Here are the filing options you should consider:

File an extension. Taxpayers who haven’t yet filed their 2008 returns but are buying a home soon can request a six month extension to October 15. This step would be faster than waiting until next year to claim it on the 2009 tax return. Even with an extension, taxpayers could still file electronically, receiving their refund in as few as 10 days after their electronic submission with direct deposit.

File now, amend later. Taxpayers due a sizable refund for their 2008 tax return but who are considering buying a house in the next few months can file their return now and claim the credit later in the year with an amended return.

Amend the 2008 tax return. Taxpayers buying a home in the near future who have already filed their 2008 tax return can consider filing an amended tax return. The amended tax return will allow them to claim the homebuyer credit on the 2008 return without waiting until next year to claim it on the 2009 return.

Claim the credit in 2009 rather than 2008. For some taxpayers, it may make more financial sense to wait and claim the homebuyer credit next year when they file their 2009 tax return rather than claiming it now on the 2008 tax return. This could benefit taxpayers who might qualify for a higher credit on the 2009 tax return. Typically this would affect people who have less income in 2009 than in 2008 because of factors such as a job loss or a drop in investment income.

Source Link: Options for Filing

Recovery Link: Recovery.gov

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