Bookkeeping Basics EZine

Bookkeeping Basics E-Zine, Issue #004 -- Mortgage Assistance Programs

Bookkeeping Basics E-Zine brings you valuable bookkepeing tips, income tax advice and the latest additions to one small business owner's experiences with "bookkeeping and tax preparation".

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Bookkeeping Basics E-Zine



In this issue...

NEWS

1) California I.O.U's Update

2) Mortgage Assistance Programs

ARTICLES

1) First Time Home Buyers Credit

RESOURCES

1) Find a Job

2) Tax Organizer

3) Tax Deduction Lists

4) Online Tax Preparation

5) Free Affiliates Master Course

6) SBI! Spring Special

In every issue....

1) Questions and Answers

2) Quote of the Month

3) Contact Me



NEWS

1) California I.O.U.'s Update

Well, it's official. California has been issuing I.O.U's and has been delaying the refunds for 30 days starting February 1, 2009 for Personal Income Tax and Business Entity taxpayers.

I haven't heard of anyone to date who has received their California refund...

2) Mortgage Assistance Programs

Suze Orman issued the following Important New Resources for Mortgage Assistance Programs:

There are now some easy ways to find out if Fannie Mae or Freddie Mac back your mortgage; and that’s the first step in qualifying for a refinance or loan modification under the government’s new program.

As I explained in an earlier scoop the Obama administration recently launched two programs aimed at helping mortgage-stressed homeowners. The administration estimates that as many as 9 million homeowners may be eligible for either the refinance or loan modification programs that are part of The Homeowner Affordability and Stability Plan (HASP)

The big first step in determining your eligibility is to find out who “owns” your mortgage. Both programs mandate that lenders consider borrowers whose mortgages are backed by either Fannie Mae or Freddie Mac. It is hoped that lenders will consider offering the same assistance to other loans as well. And given the financial incentives lenders will receive for the loan modification program I expect many will.

But for now the quickest and easiest path is to know if Fannie or Freddie back your mortgage. And we have some good news here my friends. The government has introduced a quick way to find out if your mortgage is part of either the Fannie Mae or Freddie Mac portfolios.

For Fannie Mae: 1-800-7FANNIE (8am to 8pm EST). www.fanniemae.com/homeaffordable

For Freddie Mac: 1-800-FREDDIE (8am to 8pm EST) www.freddiemac.com/avoidforeclosure

I also recommend checking out this government website that can help you understand whether you are a candidate for the HASP refinance or modification programs.

ARTICLES

1) First Time Home Buyers Credit

Increased First-Time Homebuyer Credit May Be Claimed for 2008 or 2009 (IR-2009-14; TDNR TG-39)

The IRS has announced a taxpayer-friendly option for individuals and married couples who qualify for the first-time homebuyer credit under Code Sec. 36, as amended by the American Recovery and Reinvestment Tax Act of 2009 (P.L. 111-5). Taxpayers qualifying for the amended credit have the option to claim the Code Sec. 36 credit on either their 2008 or 2009 tax returns.

The 2009 Recovery Act increased the maximum credit allowed under Code Sec. 36 from $7,500 to $8,000 ($3,750 to $4,000 for married filing separately). To qualify for the increased credit, the home must be purchased after December 31, 2008 and before December 1, 2009. The credit, as amended, does not need to be repaid as long as the home remains the purchaser's principal residence for 36 months after the purchase date.

A spokesperson at the Joint Committee on Taxation told CCH that the issue of whether the technical language of the Act supports the use of the $8,000 amount for credits claimed on 2008 returns for 2009 purchases, or whether the $7,500 amount should apply, had been debated among staff members. Their conclusion was that the congressional intent was to allow the $8,000 amount for all 2009 purchases, regardless of whether the credit was claimed on a 2008 and 2009 return. The staff economists then used that conclusion in determining the final revenue estimates assigned to this provision, as published in JCX-19-09.

CCH Comment. The changes made to the first-time homebuyer credit by the Act are effective only for residences purchased after December 31, 2008. This makes clear that the increased $8,000 cap on the first-time homebuyer credit only applies to residences purchased from January 1 through November 30, 2009. The $7,500 cap still applies to homes purchased in 2008. The language providing for an election to treat a 2009 purchase as if made in the prior year was also revised by the new act. Code Sec. 36(g) states that, in the case of a purchase of a principal residence after December 31, 2008, and before December 1, 2009, a taxpayer may elect to treat such purchase as made on December 31, 2008, for purposes of Code Sec. 36 other than Code Sec. 36(c), the definitional subsection, and Code Sec. 36(f)(4)(D), the subsection addressing the waiver of recapture for purchases in 2009. Under a technical reading of the statute, therefore, an election to treat a residence purchased in 2009 as if made on December 31, 2008, would subject the purchase to the $7,500 dollar limitation applicable to 2008 purchases under Code Sec. 36(b). The IRS appears to have decided, however, to allow residences purchased in 2009 to qualify for the $8,000 limit even where the taxpayer elects to treat the purchase as if made on December 31, 2008.

A revised version of Form 5405, First-Time Homebuyer Credit, has been posted on the IRS website (www.irs.gov/pub/irs-pdf/f5405.pdf) incorporating changes made by the Act.

In addition, the IRS reminds taxpayers that amended Code Sec. 36 does not apply to people who actually purchased a home after April 8, 2008, and on or before December 31, 2008. These taxpayers, who are claiming the credit on their 2008 tax returns, are limited to a maximum credit of $7,500 (or $3,750 for married individuals filing separately). In addition, the credit for these 2008 purchases must be repaid in 15 equal installments over 15 years, beginning with the 2010 tax year.

RESOURCES

1) Find a Job

A lot of people are hurting right now in these tough times. Close to 2 million Americans have lost their jobs, and every one of them should be coming out of the new year especially hungry to get back to work. In anticipation of the many great, qualified applicants among you that may be hoping to find that job, here is a great resource to help you achieve that goal!

Worlds largest resource for jobs within creative and competitive industries - Find a job at Creative Jobs Central

2) Tax Organizer

For my existing tax clients, you should already have received your personal tax organizer in the mail. For everyone else, please feel free to utilize this tax organizer to help you prepare for the new tax season.

Click here for the Tax Organizer

3) Tax Deduction Lists

Tax time can leave you full of questions about what kinds of expenses are deductible. The income tax forms and tax deduction lists you find here will help you determine your income tax deductions.

Click here to find out more...

4) Online Tax Preparation

If you like to prepare your own online income taxes, do it with the help of Turbo Tax. This online tax preparation software is affordable and easy to use, offering e-file and fast refund capabilities. You can learn more about the programs they have available at:

Learn more about TurboTax

5) Free Affiliates Master Course

The Affiliate Masters Course shows affiliates how to build a traffic-generating theme-based content site. From brainstorming and researching profitable keywords, to building SE-ranked Keyword-Focused Web pages using CTPM, to establishing profitable Pay-Per-Click campaigns, the course provides all the information needed for anyone to build a successful affiliate business.

Affiliate Masters CourseDownload your Free Affiliates Master Course here

6) SBI! Spring Special

The Money-Back Satisfaction & Success Guarantee takes all the risk off you and puts it on SBI!, where it belongs. Your only risk is not starting SBI! today.

Every day that passes is a day lost towards becoming a Top 1-3% business. Visualize yourself with a Top 1% Web site. Now make it happen. Make SBI! your home...

Special SiteSell Promotion Take advantage of the I Love SBI! Spring Special



Questions and Answers

Are you having difficulties with Bookkeeping? Here on the Q and A page, you can ask a question about any area of bookkeeping and income taxes. It's free and easy to do.

Here is a recent posting on the Q & A Page:

I am working for a Paving Company. Are you suppose to keep your bank/checking account statements for a certain period of time? Do I attach them to my balance sheet and general ledger for year end audits by the company hired accountants?

It is recommended that you keep your tax returns and all supporting documentation (including bank statements) for at least 4 years.

Typically, your December statement showing the balance at 12/31 and the December bank reconciliation should be kept with the Year End Balance Sheet in order to show that the two "tie out" or match.

Click here to ask a question or read more...



Quote Of The Month

"Personally, I'm always ready to learn, although I do not always like being taught."

- Sir Winston Churchill



Comments? Ideas? Feedback?

I'd love to hear from you. Just reply to this e-zine and tell me what you think! Or, click here to Contact Me.

See you next month!

Stephanie

www.Bookkeeping-Basics.net



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