August 17th, 2008
$7,500 Tax Credit For First Home
August 17, 2008
Under new Federal Legislation first-time homebuyers who close on a home between April 9, 2008 and June 30, 2009 will be eligible for a Tax Credit of $7,500. You simply file for this credit with your 2008 or 2009 tax return.
Although the tax credit is repayable at $500 per year for your next 15 tax returns, this is a significant incentive to first-time homebuyers. If your tax return, after the credit, shows the I.R.S. owing you a refund, you will receive a check. The credit is like money in your pocket because it is a full credit against your taxes in the year you claim it.
So who is eligible? – A first-time homebuyer is anyone buying a single family home or condominium to live in who has not owned a home during the past 3 years. Although this seems odd, it’s a fact. You could have owned your own home before, and still be a ‘first-time homebuyer’ again by the definition.
The tax credit is not for rich people. A single person must have an Adjusted Gross Income (AGI) of less than $75,000, and a married couple’s AGI must be less than $150,000. If you have already closed on your house, apartment or condo, so long as it was not 8th April 2008 or earlier, you can receive the full $7,500 credit against your 2008 taxes.
In effect, the credit works like an interest-free loan to be repaid over 15 years. You get $7,500 of your taxes back now, and $500 per year is added to your taxes for the next 15 years. If you sell your new home, the remaining credit owed must be paid from the profit of the sale. If there is not enough profit to pay the remaining balance, the payback is completely forgiven.
The ailing economy and housing slump will stimulate all our Legislators to create programs to kick-start real estate. Although Alaska’s real estate market might be said to have a ‘small cold’ compared to the Nation’s ‘full flu symptoms’, Alaskans will benefit from this and similar innovations as they come to light. First-time homebuyers should take advantage now because the $7,500 credit expires on 30th June 2009.
Dear Dave: I have been in my home for a few years now. The issue I have is in relation to the covenants and their lack of enforcement. In the covenants it is specific that homeowners may park 2 cars in the garage and 2 in the drive. Yet many park in the yard or designated visitor parking spots. Also, a few homeowners store boats, canoes, trailers and motor homes in their yard or driveway. By-laws state that they must store these types of items elsewhere. Also, it states in the covenants that the monthly dues will cover maintenance of common areas. Many owners do not maintain their yards.
My frustration is this. I, along with a number of other neighbors, have contacted the property manager for our homeowners association repeatedly, to express these concerns and provide information as to which cars belong to which house. She says that she fines them or sends them letters. She has actually sent some letters, but I’m not sure she has fined anyone. One time she said she couldn’t fine anyone because there wasn’t a fine schedule in the covenants. She has had some cars towed for parking on the sidewalk or in the street, but not the ones in the visitor spots. Visitors must risk being towed because of homeowners parking in the visitor spots.
It’s just one of those things that, had homeowners been held accountable, would not spin out of control like it has. I purchased my home with the expectation that the property manager would enforce the covenants and thus protect the investment I have in my home. I believed that the builder was creating a nice, clean-cut neighborhood where homeowners would take care of their yards, not drive on them or use them as a place of storage, where parking would otherwise be available for visitors. I don’t think this is something that should take legal action to correct, but I am beginning to think that it may be the only way. What should I do?
Answer: Whilst your question is a complex legal matter, which should be addressed to an Attorney specializing in Real Estate, I can offer you some guidelines. Your question is not new. Many residents of Association-controlled neighborhoods have similar complaints. What are the rules? Why are they not enforced? How can an individual bring about enforcement?
If you belong to a Homeowners’ Association of any kind, there are documents of incorporation to which you are entitled to have a copy. This ‘Resale Certificate’ or ‘Public Offering Statement’ (in the case of new construction) includes a Declaration of how the Association is structured and governed, By-laws, Rules and Regulations, and a host of other ‘stuff’.
By virtue of your home (or condo) ownership you are a Member of that Association. Members control the enforcement of covenants and by-laws through their democratic participation in the management of the Association. I have many times advised people in your situation that, if enough members agree, you can change the management, force legal action against covenant-breakers, or even change covenants, by-laws and rules.
Many Homeowners’ Associations don’t follow through with enforcement because they don’t want to offend people. You, however, purchased your property rightly believing that rules would be enforced. At the very least, prepare a Motion for the Annual General Meeting and solicit votes behind the scenes to pass the motion. After you check on the exact rules of your Association, the motion could simply be that the Property Manager be instructed to enforce the covenants/by-laws with the assistance, if needed, of an Attorney.
If you are thoroughly frustrated after this, obtain your own Attorney and sue the Homeowners’ Association for non-compliance with their own rules.
