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When the people fear the government, there is tyranny; When the government fears the people, there is liberty.  ~ Thomas Jefferson

 

Entries Tagged as 'Buyers'

Misuse of Home Buyer Tax Credit Reported

December 28th, 2009 · Buyers, Fraud Alert, Housing Industry

A report earlier this month from the Treasury Inspector General for Tax Administration estimates that 73,799 taxpayers have incorrectly claimed the first-time home buyer tax credit. The report concludes: “The IRS is unable to verify eligibility for the majority of Recovery Act benefits at the time a tax return is processed.”

The IRS didn’t dispute the claim, but said it was studying the matter further. Some have suggested that this report and others will encourage Congress to put some safeguards in place before more claims result from the extension and expansion of the tax credit.

Source: The New York Times, Lynnley Browning (12/22/2009)

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Where’s the Refund?

December 12th, 2009 · Buyers, Stimulus, Taxes

First-time home buyers who bought as long ago as last winter are still waiting for their $8,000 tax refund.

As of mid-September, more than 1.4 million taxpayers had requested the credit by amending their federal tax returns. The IRS announced in October that it expects 5.1 million claims by year-end. That count doesn’t reflect the extension and expansion of the credit in November.

IRS spokeswoman Carrie Resch says the agency is experiencing a higher-than normal number of amended returns and because amended returns are reviewed by hand, the process is delayed.

U.S. Sen. Amy Klobuchar (D-Minn.) has been fielding constituent calls for weeks from irate home buyers. She sent a letter to the IRS that said in part: “The full and immediate economic impact of the tax credit is lost when it takes up to four months for people to get the money due to them … such lengthy delays are unacceptable and erode the public’s trust in the competence of the government.”

Source: Minneapolis-St. Paul Star Tribune, Kara McGuire (12/10/2009)

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Fannie Mae to tighten lending standards

November 27th, 2009 · Buyers, Economy, Housing Industry, Stimulus, Tax Dollars

Banks will demand higher credit scores, lower borrower debt

By Dina ElBoghdady Washington Post Staff Writer
Thursday, November 26, 2009

Fannie Mae, the giant mortgage finance company that helps shape lending guidelines, plans next month to raise minimum credit score requirements and limit the amount of overall debt that borrowers can carry relative to their incomes.

The changes are the latest in a series of crackdowns by the mortgage industry and could surprise some prospective home buyers. The industry is rolling back loose lending standards that led to the mortgage meltdown and the subsequent economic crisis. But the fear is that if the industry becomes too restrictive, it will freeze out too many borrowers and impede an economic recovery.

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First-Time Homebuyer Credit Extended

November 24th, 2009 · Buyers, IRS, Taxes

First-Time Homebuyer Credit Extended to April 30, 2010; Some Current Homeowners Now Also Qualify 

WASHINGTON — A new law that went into effect Nov. 6 extends the first-time homebuyer credit five months and expands the eligibility requirements for purchasers.

The Worker, Homeownership, 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 homebuyer –– that is, a buyer who has not owned a primary residence during the three years up to the date of purchase.

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Congress passes bill extending unemployment insurance, home buyer tax credit

November 5th, 2009 · Buyers, Congress, Federal Spending, Housing Industry, Legislation, Small Business, Tax Dollars

By Perry Bacon Jr. and Dina El

Congress on Thursday completed final approval of a bill that includes several measures designed to spur the economy and help people who have lost their jobs, representing its latest intervention as the country suffers through its worst recession in decades.

The $24 billion bill, which the White House said President Obama will sign on Friday, would provide unemployment benefits of least 14 weeks for people out of work. Those in the more than two dozen states with unemployment rates above 8.5 percent would receive up to 20 weeks of the benefits. The legislation would also extend through April 30 a $8,000 first-time home buyer tax credit that was passed earlier this year.

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Congress Agrees to Keep Homebuyers’ Tax Credit

November 3rd, 2009 · Buyers, Housing Industry, Tax Dollars, Taxes

By JACKIE CALMES

Published: November 3, 2009

WASHINGTON — The Senate and House are poised to agree on a compromise measure to extend unemployment benefits that also would expand a popular $8,000 tax credit for homebuyers, despite a recent government report on extensive mistakes and suspected fraud in the program.

The Senate might pass its version as early as Wednesday, and aides to Congressional leaders say the House could accept it this week, sending the bill to President Obama to sign into law. After weeks of partisan delay in the Senate, Democrats are eager to show progress before Friday, when the October jobless report is again expected to show high unemployment.

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Homebuyer Credit Gets New Life

October 29th, 2009 · Buyers, Congress, Housing Industry, Taxes

Key lawmakers in the Senate have tentatively agreed to extend the existing $8,000 tax credit for first-time home buyers and also offer a new $6,500 credit for existing homeowners who have lived in their current residence for a consecutive five-year period in the past eight years.

Home buyers must be under contract by April 30, 2010, and close before July 1. House Democrats have expressed concern about the cost of the tax credit for the government, and allegations of abuse have resulted in an IRS probe of the program.

Source: Wall Street Journal, Corey Boles and John D. McKinnon (10/29/09)

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Tax Credit Extension Considered in Senate

October 26th, 2009 · Buyers, Housing Industry, IRS, Taxes

Senate Majority Leader Harry Reid, a Nevada Democrat, is supporting a four-month extension of the home buyer tax credit.

Two other proposals in the Senate would, respectively, extend the credit through June and, most generously, increase the deduction to $15,000 and open it up to all home buyers and those with higher incomes.

One or more of these proposals is likely to come up for a vote in the next week attached to a measure that would extend unemployment benefits for 20 weeks.

Source: The Wall Street Journal, Corey Boles (10/23/2009)

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IRS Investigates Home Tax Credit Claims

October 20th, 2009 · Buyers, Fraud Alert, Housing Industry, IRS

The Internal Revenue Service is investigating more than 100,000 claims for the First-Time Homebuyer Tax Credit that may be unjustified or even fraudulent.

The IRS has identified 167 of what it calls “criminal schemes” involving the credit. The IRS refused Monday to elaborate about the problem.

Bonnie Speedy, AARP tax-aide director, blamed the post-closing filing procedures for the problem, saying people who weren’t entitled to the credit could too easily claim it. “People are filing for the credit who don’t have a right to file for it,” she says.

Some observers say these claims could jeopardize an extension of the tax credit.

Source: The Wall Street Journal, John D. McKinnon (10/20/2009)

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Congress Debating the Tax Credit

October 15th, 2009 · Buyers, Congress, Housing Industry, Taxes

Congress is considering expanding and extending the $8,000 first-time homebuyer tax credit, which expires Nov. 30.

More than 1.8 million home buyers will have used the credit by the end of November, including an estimated 355,000 who wouldn’t have bought a home without it, according to the National Association of REALTORS® and other analysts.

Mark Zandi, chief economist for MoodysEconomy.com, is among those in favor of extending the credit. Zandi would also make it available to all homebuyers. “The most fundamental argument for the credit is that nothing works in the economy if housing is falling,” Zandi said. “[The credit] is a good insurance policy. It’s vital to stem the housing price declines.”

Opponents argue that the tax credit is too expensive and doesn’t help enough people.
Extending the credit through the end of 2010 and making it available to single filers earning up to $150,000 and joint filers earning up to $300,000 would cost an estimated $16.7 million. Some in Congress propose using unspent money from the $787 billion stimulus bill to pay for it.

Source: CNNMoney.com, Les Christie (10/14/2009)

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