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The IRS "First Time Home Buyer Tax Credit"! Time is running out.
Here is what you need to know-
You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.
If you enter into a binding contract by April 30, 2010 you must close on the home on or before June
30, 2010. Here is a link to a PDF document on the IRS website to give you the detailed information: http://www.irs.gov/pub/irs-pdf/p4819.pdf.
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Recently, I read an article relating to national commercial real estate conditions and the 2009
Stimulus Act. Many real estate owners and developers are negotiating with their lenders to modify
existing debt and the Recovery and Reinvestment Act of 2009 provides some beneficial tax relief.
With tight finance, increased vacancies, downward pressure on rents, owners are looking for relief.
The move to negotiate with lenders for debt relief, including forgiveness, has become a popular
means of capital preservation. However, debt restructuring can result in cancellation of debt
(COD) income for tax purposes, especially when the loan is reduced or the owner pays off the
loan at a discount. Most often, the cancellation is taxed as income at the borrower’s ordinary rate.
Let’s say an owner owes $500,000 on a mortgage and the lender agrees to reduce the principal to
$350,000. Unless there is an exception that applies, the owner will recognize $150,000 of ordinary
income.
The Stimulus Act gives owners an alternative. The new provision allows them to defer COD
resulting from 2009 and 2010 transactions until 2014. The owner must recognize 20% of the COD
in 2014, and in each of the next four years. The new alternative is simpler and has fewer
restrictions.
Applying this new rule to our example, if the principal of a $500,000 mortgage were reduced to
$350,000, instead of immediately paying tax on $150,000 of income, the owner can now defer the
income until 2014 and recognize $30,000 in each year from 2014 until 2018.
Secured and unsecured debts are eligible. Property value isn't considered. The basis of an owner's
property isn't reduced, and he continues to depreciate 100% of his original cost. The property
must be used in the owner's “trade or business”.
Many commercial property owners are now asking their lenders for debt relief. The 2009 Stimulus
Act alternative will allow them to restructure debt on their troubled assets without the punitive
tax consequence as before.
Information gathered from sources deemed reliable, but not guaranteed. It is recommended that
individuals check with all appropriate professionals for legal, accounting, and development advice
Curt Johnson, SIOR
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JACKSON COUNTY INCLUDES 2,801 SQUARE MILES! The counties principal industries are lumber, agriculture, manufacturing, and recreation. Its major points of interest include the Shakespearean Festival, Historic Jacksonville, Southern Oregon University, the Peter Britt Festival, the Rogue River, and many parks. Rural land owners with small acreage (nine acres or less) make up 27% of the rural landownership in Jackson County. Those with 49 acres or less account for 70% of the rural landownership. The natural and cultural history of Jackson County is diverse and fascinating. The landscapes we see today were formed over millions of years by glacial ice migrations, massive floods and red-hot lava flows. The Native peoples, include the Modoc, Shasta and Rogue River tribes who lived in the region now defined by Jackson County. Did you know that acorns were used to produce flour used in bread, puddings and soup. Did you know that Jackson Counties Agricultural has grown to over a 60 million dollar industry and the first commercial orchards were planted in 1885. There are many hiking and riding trips you can take to enjoy the Southern Oregon region. ( information obtained from the Jackson Country Rural Living Handbook).
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Staging a house for sale is a concept foreign to many home sellers. But it has been immensely popular in the San Francisco Bay area where sellers have reaped huge benefits from their efforts. In a recent Inman News article, they said the sellers don't have to fix up their home before selling if the home is priced right. There are basically two reasons why sellers should prepare their home for sale, a sales price closer to the listed price and a quicker sale. A few quick and easy cosmetic improvements ideas that can really make a difference: remove old window coverings and leave them off, remove some furniture, change out olders light fixtures, paint outdated cabinets and change cabinet knobs, and even think about painting the walls a trendy decorator color. The goal of fixing up a ahouse for sale is to get it into move-in ready condition. Fixer-uppers appeal only to certain buyers who usually want a break on the price to compensate for the condition of the property. By sprucing the property up for sale, you appeal to a much broader audience.
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A weblog (blog) is an online journal to share updates, ideas, project status, or anything else you want. Blogs allow everyone to be a contributor rather than just a bystander.
Postings are arranged chronologically and can be categorized depending upon how the administrator has configured the system. You can view a post by clicking on the title from the home page where all users' posts are collectively shown. Once viewing a blog you can read other posts by that person or provide comments on postings.
Creating new posts is quick and easy. If you have the ability to post you should see a link (usually on the left) on your weblog's home page: new post. Clicking on this link takes you into your blogs administration pages for creating new posts.
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