Monday, November 23, 2009
Congress Extends Homebuyer Tax Credit Until April 30, 2010
On November 5, 2009, Congress voted to extend the homebuyer tax credit program until April 30, 2010. The extension continues the $8,000.00 tax credit to first time homebuyers, and includes an additional credit for current homeowners of $6500.00. Further, by extending the Homebuyer tax credit, the Florida Homebuyer Opportunity Program will continue to provide loans to first time buyers for down payment and closing costs. The chart below provides a comparison of the benefits to homeowners under the original act and the new benefits under the extended program:
FEATURE
|
Jan 1 – Nov 30, 2009 |
Nov. 7 – April 30, 2010 |
First-time Buyer |
$8000 |
$8000 |
First-time Buyer |
May not have had an interest in |
Same |
Current Homeowner |
|
$6500 |
Effective Date |
|
|
Current Homeowner |
|
Must have used the home sold |
|
Purchases after November 30, |
Purchases after April 30, 2010 |
|
|
So long as a written binding |
Income Limits |
$75,000 – single |
$125,000 – single |
Limitation on Cost of Purchased Home |
|
$800,000 |
Purchase by a Dependent |
No Provision Ineligible |
November 7, 2009 |
Anti-fraud Rule |
|
Purchaser must attach |
Tuesday, November 3, 2009
An IRS 1099-C Form Does Not Mean Debt Is Discharged
A third circuit bankruptcy case recently decided that Form 1099-C does not establish that debt is discharged. A creditor typically issues a Form 1099-C to a debtor in bankruptcy to show cancellation of debt. The credit union in the case In re Bononi, had sent the Chapter 7 debtor zero-balance account statements and an IRS form 1099-C for “cancellation of debt.” After receipt of the form and the account statements, the debtor received money from the settlement of a personal injury action. The court found that despite the statements and the 1099-C form, the debtor still had an obligation to pay on the past debt. Additionally, the court found that even if a creditor issues a 1099-C form, the form does not prohibit the creditor from pursuing collection of the old debt. Only a discharge from the Bankruptcy Court has the effect of canceling the debt and removing the debtor’s liability for the debt. In re Bononi, 19 CBN 864.