The President signed
the "Housing Assistance Tax Act of 2008" on
July 30, 2008.
There are positive portions of this act and there are negative portions of this act.
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 This growing season marks the first year in which I officially have my very own vegetable garden. The deal at the Eaton household is that my husband, Sam, is in charge of mowing the lawn and I'm in charge of weeding. I have realized that in order to keep up my end of the bargain, my pink gardening shoes and work gloves need to be a frequent part of my evening and weekend wardrobe! Our crop so far has only consisted of fresh basil, onions and garlic but I have confidence that if the rain lightens up and I make sure Sam doesn't have another opportunity to call my "vegetable garden" a "weed garden," we'll have a great harvest later this month.
Hillary Eaton
Like the vegetation taking over Hillary's garden, a new Tax Act that was just signed in Washington has both positive provisions as well as provisions that are not so taxpayer friendly.
Austin Associates, PA, CPAs |
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The Housing Assistance Act of 2008
The positive portions of this act are:
An additional standard deduction for real estate taxes equal to the lesser of :
Real estate taxes paid or,
$500 ($1,000 if filing jointly).
A first-time home buyer's credit of 10% of the purchase price of a home up to $7,500 on homes purchased between April 9, 2008 and July 1, 2009. This credit is actually an interest free loan from the government which will have to be repaid over 15 years or sooner, if the property is sold or converted from a personal residence. The credit phases out for AGI's over $75,000 single ($150,000 married filing jointly.
The two provisions that are not taxpayer friendly are:
Businesses that allow customers to pay with credit or debit cards will start receiving a 1099 from their credit card processor effective for sales made on or after January 1, 2011. The credit card company will be required to report gross receipts to the business and the IRS. 1099 reporting will not be required for total transactions of less than $20,000 in a year or less than 200 transactions.
Gain from the sale of a principal residence will no longer be excluded from gross income for the periods of time that the home was not used as a principal residence. This provision applies to home sales after December 31, 2008 and for "non-qualified use" occurring after January 1, 2009.
There are other provisions of the law that apply to low-income housing credits, REIT's , Tax-exempt housing bonds, mortgage revenue bonds, AMT credits and R & D credits.
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