October 2009
$8,000 Tax Credit Fraud Under IRS Scrutiny
October 27, 2009 by dbradley · Leave a Comment
Monday, October 26, 2009
$8000 Tax Credit Fraud under IRS Scrutiny
According to the Wall Street Journal, the IRS is reportedly examining more than 100,000 suspicious claims for the $8000 dollar tax credit and is investigating 167 “criminal schemes” involving the credit. IRS officials declined last week to describe the suspected schemes or provide additional details. However, they did say they have identified the different types of potential fraud and matched them against their compliance program.
We could speculate about how people are trying to commit fraud with the $8000 tax credit. Perhaps they are modifying closing statements, commonly known as HUD-1′s to make it appear the house was purchased in the correct tax year. Perhaps they are taking incorrect tax advice from their accountants. Perhaps people are modifying HUD-1′s to make it appear that they bought a house — when in fact they did not. Regardless, the IRS taking it very seriously.
The IRS says it has received more than one million claims for the $8000 tax credit. Housing industry experts estimate the credit helped to generate at least 350,000 additional home sales. The $8000 tax credit to set to expire on November 30, 2009 but leaders in the housing industry are lobbying Congress to extend it.
It would seem that widespread abuse would be relatively easy because of the loose standards for claiming the credit. In other words, the IRS never set anything in place with title and escrow companies to document the tax credit at time of sale. Free money has had a history of attracting people with dishonest intent, and $8,000 is a good deal of money. This is just the kind of trouble that will delay or eliminate the proposed extension of the program, or even it’s conversion to the much talked about “$15,000 tax credit.” It’s always sad when dishonest people potentially destroy a good program they can benefit the masses.
On the other hand, does our country really need an extension of the $8000 credit, or even a new $15,000 tax credit? Has our country, which already has enough debt to choke 20 medium-sized countries, need to be giving out more money it doesn’t have? It does seem that many citizens have developed an attitude of “entitlement” and expect the government to just keep giving out more and more money. But I digress…
According to the IRS website , the IRS successfully prosecuted its first fraudulent tax credit case in July 2009. A Jacksonville, Fla. tax preparer, James Otto Price III, pled guilty to falsely claiming the $8000 tax credit on a client’s federal tax return. Price faces the possibility of up to three years in jail, a fine of as much as $250,000, or both.
A quote from the IRS’s website:
“We will vigorously pursue anyone who falsely tries to claim this or any other tax credit or deduction,” said Eileen Mayer, Chief, IRS Criminal Investigation. “The penalties for tax fraud are steep. Taxpayers should be wary of anyone who promises to get them a big refund.
It’s What You Make Of It
October 27, 2009 by dbradley · Leave a Comment
Your life will always be to a large extent what you make of it.
The mold to your success and fortune are in your hands.
You cannot do everything, but you can do something.
You choose your thoughts and actions. Nobody can do it for you. Nobody will do it for you. You have to make things happen.
If you take responsibility for your actions, you can achieve anything.
HAVE AN AWESOME DAY!!
Believe in Yourself
October 28, 2009 by dbradley · Leave a Comment
“Every achiever that I have ever met says, ‘My life turned around when I began to believe in me.’”
Dr. Robert Shuller
Minister and Author
Praise Others
October 29, 2009 by dbradley · Leave a Comment
There is no investment you’ll ever make that will pay you so well as the effort to scatter sunshine and good cheer where ever you go.
The deepest principal in human nature is the craving to be appreciated.
If you treat someone as if they were what they ought to be and could be, they will become what they ought to be and could be.
Everyone thrives on being appreciated, loved and needed.
There is no stimulus like that which comes from the consciousness of knowing that others believe in you.
Applaud others when they do something well. Console them when they fall. And cheer them when they recover.
As water is to a flower, so is praise to the heart of another.
Have an Awesome Day!!
When The Student Is Ready
October 30, 2009 by dbradley · Leave a Comment
Chance is turned into good fortune by successful people. We are surrounded by all kinds of opportunity.
Luck is being at the right place at the right time. Taking advantage of opportunity is always under your control.
When you are mentally prepared, the right opportunity will present itself.
Talent alone won’t make you successful. Neither will being at the right place at the right time unless you are ready.
When the student is ready, the teacher appears.
Have an Awesome Day!
Homebuilder Shares Mixed
October 27, 2009 by dbradley · Leave a Comment
(AP) – 31 minutes ago
NEW YORK — Shares of homebuilders were mixed Tuesday after a report showed home prices rising in 20 major metropolitan markets for a third straight month, while one analyst suggests the improvement is only temporary.
The Standard & Poor’s/Case-Shiller home price index gained 1 percent in August from July to a seasonally adjusted reading of 144.5. While prices are down 11.4 percent from August a year ago, the annual declines have slowed since February.
Prices are at levels not seen since August 2003 and have fallen almost 30 percent from the peak in May 2006.
Still, economists are concerned home prices cannot withstand falling consumer confidence, rising unemployment and foreclosures and the looming deadline for a first-time homebuyer tax credit. A separate report Tuesday from The Conference Board showed consumer confidence sliding unexpectedly.
Deutsche Bank analyst Nishu Sood wrote in a note to investors that foreclosures are the main reason home prices fell so fast and so far, and said he expects further pressure on home prices in 2010.
“Demand was boosted by investors and tax credits, supply was constrained by foreclosure moratoriums (and) modifications, and (Federal Housing Administration) financing was flowing freely,” he wrote. “This entry level stabilization was real, but it is principally government sponsored and therefore tenuous.”
Shares of homebuilders were mixed in afternoon trading. Hovnanian Enterprises Inc. added 21 cents, or 5.2 percent, to $4.28; Lennar Corp.’s stock rose 13 cents, or 1 percent, to $13.70; Meritage Homes Corp. gained 23 cents, or 1.2 percent, to $19.44; and shares of MDC Holdings Inc. advanced 34 cents, or 1 percent, to $34.59.
Toll Bros. lost 25 cents, or 1.4 percent, to $18.11, while DR Horton Inc. lost 7 cents to $11.86 and Ryland Group Inc. slipped 4 cents to $20.04. Pulte Homes Inc. edged down 4 cents to $9.66 and KB Home’s shares fell 13 cents to $15.32.
Copyright © 2009 The Associated Press. All rights reserved
First Time Homebuyer Tax Credit Extension
October 28, 2009 by dbradley · Leave a Comment
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The Senate’s top Democrat and top Republican each voiced support on Wednesday for extension of a soon-to-expire $8,000 tax credit for home buyers, but left unclear when the chamber would act.
“There has been general agreement by a significant number of senators, Democrats and Republicans, to get this done,” Senate Majority Leader Harry Reid, a Democrat, said on the Senate floor.
The chamber’s top Republican, Senator Mitch McConnell, also said most senators support the measure. “I certainly share his view,” McConnell said.
The tax credit for first-time home buyers, which has helped lift the housing market out of its worst slump since the Great Depression, is set to expire on Nov. 30 and senators have been negotiating over how best to extend it.
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Under an agreement reached by key senators, the tax credit would be extended through the end of April and be expanded to cover repeat buyers who have been in their homes at least five years, sources familiar with the plan said.
First-time buyers would continue to get an $8,000 credit, while repeat buyers of primary residences would be eligible for a credit of $6,500, the sources said.
They said the credit would be available for individuals making up to $125,000 a year and couples earning up to $225,000 per year.
Timing of a Vote Uncertain
While extending the credit enjoys widespread support, its fate is caught up in a spat between Reid and McConnell over unrelated issues.
Reid had wanted to attach a bill to extend the homebuyer credit as an amendment to legislation to lengthen insurance benefits for unemployed workers. The Senate voted to take up the insurance benefit bill on Tuesday, but did not attach the homebuyer tax credit to the measure.
Despite that apparent roadblock, Senate Finance Committee Chairman Max Baucus, who has been involved in negotiations over the tax credit, told Reuters late on Tuesday that he expected the Senate would vote on the bill sometime this week.
“There are various paths and whichever works first is the one that is going to be” followed, he said, referring to the possibility that the Senate could vote on the bill independently or as part of separate legislation.
A spokeswoman for Reid said the unemployment insurance measure could get pushed to next week as lawmakers try to resolve differences over unrelated issues, which would delay consideration of the homebuyer credit extension.
“We will get this extension passed,” she said.
A report last week showed sales of previously owned homes hit a two-year high in September as buyers rushed to take advantage of the credit before its expiration date. However, a report on Wednesday showed new home sales, a much smaller segment of the market, tumbled unexpectedly last month.
Separately, a report from the Mortgage Bankers Association on Wednesday that demand for mortgages has fallen for the past three weeks as buyers move to the sidelines.
A buyer would have to close on the purchase of a home before Nov. 30 to take advantage of the current tax credit.
My name is David Bradley. I want to thank you for taking the time to visit my website, where I guarantee you'll find plenty of helpful information to assist you in purchasing your new home or refinancing your current mortgage. I am a Mortgage Consultant serving Dallas, Texas and the surrounding areas.