Advice for Those Seeking the Tax Credit

Taxpayers Seeking Homebuyer Tax Credits, Refunds Must File Paper
by Broderick Perkins

Homeowners filing for the home buyer tax credit are not allowed to use electronic filing and must file hard copies due to special documentation requirements.

Earlier this year, the Internal Revenue Service (IRS) deployed new home buyer tax credit forms and instructions requiring forms that will force taxpayers to file on paper, rather than electronically.


Under the new and expanded home buyer tax credit rule , the credit is worth up to $8,000 for first-time home buyers and up to $6,500 for qualifying existing home buyers, in both cases, who buy a primary residence or have one built.

The tax credit is refundable. A credit that is larger than the taxes owed is returned to the taxpayer in the form of a refund.

The home can cost no more than $800,000 and qualifying income is limited to a maximum of $125,000 for single taxpayers and $225,000 for joint taxpayers.

Get the full scoop online from the IRS' "First-Time Homebuyer Credit" page online.

In addition to Form 5405, also include at least one of the following documents:

• A copy of the HUD-1, Settlement Statement, showing all parties' names and signatures, property address, sales price, and date of purchase.

• For mobile home buyers who don't get a settlement statement, a copy of the executed retail sales contract showing all parties' names and signatures, property address, purchase price and date of purchase.

• For new home buyers who don't get a settlement statement, a copy of the certificate of occupancy showing the owner’s name, property address and date of the certificate.

Existing home owners applying for the $6,500 maximum tax credit must additionally prove they lived in their old home for the required period.



Information courtesy of Realty Times

Smoke Detector Law in Effect for WS!

Effective Feb. 18, 2010, the new Smoke Detector Ordinance passed 18 months ago goes into effect. It applies to ALL homes within the city limits (and jurisdictional district) of Winston-Salem.

The new law requires detectors in every bedroom (and some other "rooms that can be used for sleeping") and on every floor. The property owner is the responsible party - this is important for rental property! Property managers are also responsible to make sure there is compliance according to the NC Real Estate Commission.

Be a Smarty!

If you are a new mom or even an experienced one looking for help, resources, fun, advice, etc., look no further than TriadSmartyPants.com. It's a blog devoted to everything "mom" with interesting tidbits, helpful links, and stories that will make you laugh. Need to know about summer camp, local photographers, or upcoming consignment sales? Just visit TriadSmartyPants.com to find vendors that are "Smarty Approved"!

Bring Your Sweetie!

6810 Gray Moss in Doublegate in Clemmons will be open Sunday (yes, it's Valentine's Day...) from 2-4 pm. Come see this move-in ready home, available for immediate occupancy. Its family friendly floorplan features large room sizes, separate entertaining areas on the main level, and all bedrooms and laundry on the second level. The home is all brick and is an excellent entry level home for desirable Doublegate. Come see for yourself, and bring your Valentine!

Main Level Memories...

Young parents often want their bedrooms close to their children but not TOO close... for them, a split floor plan can be ideal. My newest listing, 287 Cinnamon Way in Fernhill in Clemmons, NC, offers main level convenience and that "close enough but not too close" floorplan. The master, 2nd, and 3rd bedrooms are all on the main level, with the living room and kitchen separating the master from the additional rooms. So... no steps to climb in the middle of the night... but just a room away should your child need you... but far enough away that the parents can watch Letterman and not awaken the sleeping angels. Go to AmandaShore.com and check it out!

Do Not Wait!

Waiting a few extra days or weeks to purchase a home this spring could cost buyers thousands of extra dollars as the office of Housing and Urban Development (HUD) implements several changes for loan guaranteed by the Federal Housing Authority (FHA).

Coming just weeks before the April 30 deadline for the Home Buyer Tax Credit and just days after the March 31 expiration of the Federal Reserve Board's mortgage backed securities purchase program (which has kept home loan rates artificially low for over a year), these FHA changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5, the cost of required up-front mortgage insurance for loan guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower purchasing a $200,000 home with a $7000 down payment, the up-front mortgage insurance will increase by $965. Up front mortgage insurance is typically financed in the final loan amount so the impact to a monthly payment will be minimal, but overall, the increase is still borne by the borrower both upfront and monthly.

Later this Spring, the amount of money that a seller can return to the buyer from their sale proceeds will be reduced from 6% to 3%. The reduction in these "seller concessions" can increase the amount of cash a buyer will be required to pay at closing by $6000 for a home purchase of $200,000.

Information courtesy of Jennifer Tuttle with Allen Tate Mortgage