[jokilewqs]

Economic stimulus, tax breaks for homeowners, mortgage forgiveness, debt relief …

If you feel a headache coming on, you’re not the only one.

All these things have something in common: money in your pocket. And they provide all the more reason for you to visit an on-base tax center for free assistance.

To locate the tax center, contact your nearest legal assistance office.

Free help is available to active-duty personnel, retirees and family members. Some reserve centers are setting up tax preparation centers.

Legal assistance officers are explaining the consequences of one benefit, which provides a tax credit of up to $7,500 for people who bought their first home in 2008, said Lt. Col. Janet Fenton, deputy chief of the Army’s legal assistance policy division.

In this case, “first time” means you hadn’t owned a home in the previous three years. The tax credit is 10 percent of the purchase price, up to $75,000.

However, you have to start repaying the credit in 2010. If you receive $7,500, which most will, that’s $500 a year over the course of 15 years.

If you sell the house or rent it, you have to pay the full balance of the tax credit in the year that the house is no longer your principal residence. Fenton said that’s a critical consideration for military members, who often transfer every two or three years.

“I’m worried that a lot of them are taking the tax credit and don’t understand they have to repay it” — and need to plan accordingly, she said.

Not so if you’re using the newer 2009 tax credit for first-time homebuyers, which is extended to those who close on their homes by Nov. 30, 2009.

You don’t have to repay the credit for a home bought in 2009 unless you sell it within three years. The law also increases the credit to a maximum of $8,000 for homes bought this year, and it allows you to take the credit for the 2009 purchase on your 2008 taxes — but if you do, you can only take a credit of up to $7,500.

A sailor whose Virginia home was foreclosed on in August has another question on mortgages. Normally, when debt is forgiven by a lender, it’s considered taxable income. But the December 2007 Mortgage Debt Relief Act allows certain canceled debt on your principal residence to be excluded from taxable income, including mortgage debt forgiven in connection with a foreclosure.

The sailor said a tax form sent to him by the lender indicates that he, the sailor, must claim the loss as taxable income — more than $125,000.

Fenton said the sailor should go to his tax center on the closest military installation for help in sorting it out with the lender.

According to the Internal Revenue Service, the lender was required to send a form 1099-C, “Cancellation of Debt,” by Feb. 2. The information should be entered on IRS Form 982, “Reduction of Tax Attributes Due to Discharge of Indebtedness.” Only lines 1e, 2 and 10b need to be completed on the form.

This sailor and others who have gone through foreclosure or other actions because they couldn’t sell their homes after receiving reassignment orders may be able to benefit from provisions in the economic stimulus law signed Feb. 18 by President Barack Obama.

The law expands the Homeowners Assistance Program to help service members on permanent change-of-station orders affected during the current housing crisis, as well as certain wounded warriors and surviving spouses, and provides more help to those affected by 2005 base realignment and closure actions.

For assistance related to PCS moves and base closure and realignment, it applies to those who bought their primary residence before July 1, 2006, and sold it or will sell it between that date and Sept. 30, 2012.

The law authorizes the Defense Department to help homeowners in one of several ways, including buying the house or reimbursing for certain losses when the service member sells the house or suffers a foreclosure.

Applications for the program can be found online.

Meanwhile, if you receive benefits under this program, they will be taxable — anything you get that is over 95 percent of the current fair market value when you received PCS orders.

For those who are “upside down” on their mortgages, this could take a bite. For example, say your mortgage balance is $300,000, and you can sell your home for only $200,000. If the Defense Department provides $100,000 to pay off the mortgage, you would have to pay taxes on $110,000.

Talk to the tax preparation experts on your installation for advice on what you can do this year to mitigate the impact.


Article: http://www.militarytimes.com/money/f...pper_031809w2/
Legal Assistance: http://legalassistance.law.af.mil/content/locator.php

[teridbruse]

For assistance related to PCS moves and base closure and realignment, it applies to those who bought their primary residence before July 1, 2006, and sold it or will sell it between that date and Sept. 30, 2012.

The law authorizes the Defense Department to help homeowners in one of several ways, including buying the house or reimbursing for certain losses when the service member sells the house or suffers a foreclosure.

Applications for the program can be found online.

Meanwhile, if you receive benefits under this program, they will be taxable — anything you get that is over 95 percent of the current fair market value when you received PCS orders.

For those who are “upside down” on their mortgages, this could take a bite. For example, say your mortgage balance is $300,000, and you can sell your home for only $200,000. If the Defense Department provides $100,000 to pay off the mortgage, you would have to pay taxes on $110,000.

Talk to the tax preparation experts on your installation for advice on what you can do this year to mitigate the impact.[/I]


Article: http://www.militarytimes.com/money/f...pper_031809w2/
Legal Assistance: http://legalassistance.law.af.mil/content/locator.php

THis is great news for me... but I didn't know I was going to ahve to pay taxes on the $200K it is going to take to get me out of my house. But then $20K in taxes is still better than being $200K upsidedown on the house. Guess I better start looking for deductions for this year... lol

[Z2sc8gEz]

Crusty what does this mean exactly - I am not gettng it. I am getting our house redy to try an lease it since we PCS'd - We have only been in it a little over two years and are not really upside down but I am not sure we can sell it.

[Suentiend]

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Crusty what does this mean exactly - I am not gettng it. I am getting our house redy to try an lease it since we PCS'd - We have only been in it a little over two years and are not really upside down but I am not sure we can sell it.

mel, dear... if you can't sell it, think it might be because your asking to much??? Sweet... can't have it both ways, you are in an area where it should sell, plus the buyer should be able to get a loan now... yes, being a little sarcastic...lol

Good Luck...

.

[ATTILAGLIC]

Crusty what does this mean exactly - I am not gettng it. I am getting our house redy to try an lease it since we PCS'd - We have only been in it a little over two years and are not really upside down but I am not sure we can sell it.

It means if you take advantage of the Corps of Engineers "buy-out" program, whatever they shell out to cover the difference between what you owe and what it is worth is taxable income.. because they are "giving" you that money. In my case I owe about $455K on my house, which is currently only worth $263K. So 95% of the difference will leave me with a net of $185K in additional income for the year. That's gonna bump me up into the OMG tax bracket, so I am not sure how much I'll end up owing next year... but it certainly won't be $193K, so I'll still be WAY ahead!!

[halyshitzob]

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mel, dear... if you can't sell it, think it might be because your asking to much??? Sweet... can't have it both ways, you are in an area where it should sell, plus the buyer should be able to get a loan now... yes, being a little sarcastic...lol

Good Luck...

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You butt headed man!!!!!! - The banks still aren't lending. I talked to one of my ladies yesterday at BOA she said no go! We will just lease for a couple of years and see if the market doesn't come back a bit. Especially after I have painted this B#$@% - I don't ever want to have to earn a living painting!!! you know that horrible burnt gold in my living room? Well you can't match it for crap!!!! We put in a new kinda marbled green floor int he downstairs bath. We did the front room of the bath in kinda a army green. It looks really cool. I asked James why he didn't fix all this stuff when I actually LIVED here - Its almost done thank God!

[Chooriwrocaey]

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You butt headed man!!!!!! - The banks still aren't lending. I talked to one of my ladies yesterday at BOA she said no go! We will just lease for a couple of years and see if the market doesn't come back a bit. Especially after I have painted this B#$@% - I don't ever want to have to earn a living painting!!! you know that horrible burnt gold in my living room? Well you can't match it for crap!!!! We put in a new kinda marbled green floor int he downstairs bath. We did the front room of the bath in kinda a army green. It looks really cool. I asked James why he didn't fix all this stuff when I actually LIVED here - Its almost done thank God!

well, you know me, never know... I try to say what you not think of... In your case, I try to cover all bases.... ha ha ha
Ok, now I got ya going... did you get an apprasial?
Did ya fix the front door?
Sounds like the floor thing (colors, who would of ever expected damn army green, ok ok what the hell is the dif. between Army Green and the Marine Corps green [we called it the green machine...]) works well, are ya done now? I mean are ya in Georgia for good? (well, till james is through school anyways)
Heck, James is gone all the time..lol
So, its you or the shoe .... he he

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[Npbfamgt]

Hee Hee - NOOOOO I am here In TN. He will be here tomorrow to fix the last few things. Then we are off to GA until Liz graduates. James cashed one of our IRA's so we have a little cash and we are just gonna lease the house - You know what I didn't do??? Well I will tell you I forgot about those dam breaks on the truck and drove it yesterday and they locked up and I have a $700 break job I have to add in now - geeezzzzze!!!! Army green ???? I don't know why, it's not like it is really green it's actually a lot greener than that !!!

You should come for Liz's graduation - She has decided she is going to Hawaii with her new soldier -

[seatlyled]

This is nice for alot of people, but everything I've read what about those who bought a house after July 2006 until whenever they actually created the housing credit.

For instance I PCS'd to Keesler AFB in Dec 06, there was no family allowed unless you secured housing (KATRINA) so I felt forced to buy a house and now I have hope that it will sell next year when I PCS again.

Yep! this is what my CPT has told me. We bought our house Oct 06 and we qualify for nothing. But....aftertalking to the bank leasing it out is a good idea. The market on leasing has gone through the roof here because getting a loan is much more difficult so many can't get a loan and then there are those that don't want to buy and get into the same situaion we are in so the average lease is aroun 1200 a month. We desided even wih the potential weaar and tear, if we keep it for about 3-6 more years then we will get our money backout of it and can lease it for enough to cover repairs when neccessary. Not the ideal situaion but at least we don't have to go into forclosure.