From Lenny's Desk
The Sturbridge Taxman's Blog

Clues to help solve your financial and tax puzzles!

Cormier & Rea announce additional office at 483 Summer St, Ste 2000, Arlington, MA

President Bush Signs Housing Bill into Law

Categories Tax Tips (Fed)

On July 30, the president signed into law HR 3221, a bill that many consider the most significant piece of housing legislation in a generation. The bill (well, now law) overhauls Fannie Mae and Freddie Mac oversight and is expected to help stabilize the nation’s housing market. The law includes a sizable tax title. There is a first-time homebuyer credit of up to $7,500, which applies to homes purchased on or after April 9, 2008 and which also phases out on AGIs exceeding $75k (single) and $150k (MFJ). You’ll need to beware though, this credit is actually an interest-free loan that must be paid to IRS in even installments over fifteen years. Further, the law includes an additional standard deduction for property taxes for non-itemizers (for one year, limited to $500/$1,000 depending on filing status), a provision that allows hurricane Wilma, Katrina, and Rita victims who took casualty loss deductions for residential damages and later received casualty-loss grants to file amended returns without penalty.

Also, please remember that part of the law is being paid for by partially denying excludable gains from the sale of certain residences (e.g., rental properties and vacation homes) that are sold after being converted into primary residences. Another revenue offset is a requirement for information reporting on credit card and third-party payment transactions. What precisely IRS is going to do with this data is unknown, but the reporting is expected to help the agency address the tax gap to the tune of $9.5 billion over ten years. In any event, you will want to know that this information reporting is required of third-party payment processors (not the business itself) for merchants with annual sales over $20k or an annual volume exceeding 200 transactions.

This message brought to you by: Cormier & Rea, Inc. Sturbridge MA. Providers of Income tax planning and preparation and financial planning. For more information about this or any other issues regarding income tax planning or preparation or financial planning, feel free to contact us. Like Cormier & Rea, Inc. on Facebook for timely updates.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. Some of this material may have been developed and produced by a third party to provide information on a topic that may be of interest. Any third party content providers are not affiliated with the named representative, broker - dealer, state - or SEC - registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

Avantax affiliated financial professionals may only conduct business with residents of the states for which they are properly registered. Please note that not all of the investments and services mentioned are available in every state.

Securities offered through Avantax Investment Services℠, Member FINRA, SIPC. Investment advisory services offered through Avantax Advisory Services℠. Insurance services offered through an Avantax affiliated insurance agency. 3200 Olympus Blvd, Suite 100, Dallas, TX 75019 (972) 870-6000.

The Avantax family of companies exclusively provide financial products and services through its financial representatives. Although Avantax Wealth Management® does not provide or supervise tax or accounting services, Avantax representatives may offer these services through their independent outside business. Content, links, and some material within this website may have been created by a third party for use by an Avantax affiliated representative. This content is for educational and informational purposes only and does not represent the views and opinions of Avantax Wealth Management® or its subsidiaries. Avantax Wealth Management® is not responsible for and does not control, adopt, or endorse any content contained on any third party website.