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Foreclosure buster?! Thanks for nothing!

Jun 30

Posted by Christopher in ECONOMY, FORECLOSURE, HOUSING ASSISTANCE, RECESSION, Uncategorized

The Home Affordable Modification Program, better known as HAMP, started in March of 2009 and suddenly gave hope to home owners who were struggling to make mortgage payments, or facing foreclosure.  HAMP is a program that modifies loans for struggling home owners that simply can’t afford their mortgage, in some cases HAMP has dropped interest to as low as 2% to help people make their payments.  Sounds like the answer to everyone’s problem right? Unfortunately, HAMP has been nothing but a HUGE disappointment.

“It has failed and it has failed miserably,” said Representative Jackie Speier, a California Democrat”

Here’s why:

Since the program started in 2009 1.24 million people have enrolled into HAMP and of those 1.24 million people more than a third have dropped out of the program.  Last month alone 150,000 people dropped out of HAMP bringing the total to 436,000 since the start of this program.  Why is the program, that was estimated to help 3-4 million homeowners, failing so miserably?  The answer to that question is simple: banks gave loan modifications for people who did not even qualify for the program!  Sound familiar?  The Obama administration simply pressured banks to sign up people for HAMP without proof of income, then once in the program people were asked later for information regarding income and many troubled home owners were disqualified or simply dropped out!

According to estimates about 5.7 million home owners are 60 days delinquent in the 1st quarter of 2010.  Basically, that means 5.7 million home owners have failed to pay their mortgage for 60 days (2 months).  Of those 5.7 million home owners ONLY 1.7 million are eligible for HAMP, leaving 4 million delinquent borrowers left to continue struggling to make payments or face foreclosure.

So really the only thing that this program has succeeded at is getting everyone’s hopes up and then kicking them to the curb.  Thank you, for nothing!

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Tax Tips for 2010!

Apr 19

Posted by Christopher in TAXES, Uncategorized

The 2009 tax season has closed for most of you.  However, it is never too early to start planning on how to approach your 2010 tax returns, especially since the Bush-era tax cuts are set to expire.  Here are some tax tips and changes to consider for the year 2010:

1. IRS standard deductions for heads of household will be inflated:

  • The standard deduction for heads of household will rise $50 to $8,400; other standard deductions will remain the same.
  • Personal exemption amount will remain at $3,650 for 2010.

2. Unless Congress decides to extend the Bush-era tax cuts capital gain tax rates (taxes on assets and investments) will increase in 2011:

  • Capital gains rate for people in the 10% or 15% bracket is currently 0%, but the rate in 2011 is set to increase to 10%.
  • Capital gains rate for people in the 25%, 28%, 33%, 35% bracket is currently 15%, but is set to increase to 20%.

3. The estate tax for 2010 was set to be 0%, but the House of Representative and Senate has yet to decide on whether to keep the estate tax at 0% for 2010 or to maintain the same estate tax rate of 2009.  The estate tax rate in 2009 was 45%.

4. If Congress chooses not to do anything to keep current tax rates, 2010 will be the last year people can enjoy the marginal tax rates of 10%, 15%, 25%, 28%, 33%, 35% (See chart below):

  • If Congress does not act to keep these rates in effect by the end of 2010 they will reset in 2011 to: 15%, 28%, 31%, 36%, and 39.6%.

Please stay tuned to the Maco & Associates blog for further tax tip updates!

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Crayons, Sunglasses, Cupcakes and lots of other things are tax deductible!

Mar 19

Posted by Hannah in CREDIT, STOCK MARKET, TAX CREDITS, TAXES, UNEMPLOYMENT COMPENSATION, Uncategorized

When and where there are tax credits or breaks available, we try and make sure you know about them. No need to worry if you itemize or not, there are several deductions that you can be taking advantage of for 2009! Let’s take a look:

$ PROPERTY TAXES: By claiming state and local property taxes on your 1040, you may deduct up to $500 (or $1,000 filing jointly). If you do itemize, you may deduct the full amount.

$ CAR TAXES: Sales tax paid on a car purchased from Feb. 17-Dec. 31, 2009 can be deducted up to $49,500 of the car’s purchase price. This deduction is available even if you also used the Cash for Clunkers Program.

$ HOMEBUYERS CREDIT: The rules changed for the homebuyer credit midway through 2009. Now it can be applied to first time homebuyers and previous home owners. To know all the dates and limits go to the IRS website and to know more about the credit check out our blog on it.

$ TEACHERS SUPPLIES: If you spent money purchasing items for your classroom (crayons, calculators, paint) you are eligible for a $250 credit, dollar for dollar. This is only available if you do not itemize your return.

$ CAPITAL LOSSES: Any stocks or funds that you may have sold at a loss can be used to offset your gains. This means any losses from stocks in 2009 up to $3,000 or any carry over losses you did not get to use entirely in 2008.

$ JOBLESS BENEFITS: If you collected any in 2009, the first $2,400 of jobless benefits are tax deductible.

$ SANDWICH GENERATION: Are in the middle and taking care of both your children and your parents? If your parents makes more than $3,650 per year (not including social security benefits) then you cannot claim them as dependent. But, you may be able to claim them as a medical dependent if you or a group of you and your siblings provide more than 50% of their support. In this case, one person from that group may claim the parents as a medical dependent and can deduct their medical expenses as their own. The other slice of bread would be your children. While college is becoming more and more expensive, the American Opportunity Tax Credit allows you to claim $2,500 per student per year for the first four years of college. This credit however, does begin to phase out at income of $80,000.

$ CHARITY WORK OR HELP: Any donations that were made to Haiti in January and February of 2010 are deductible on 2009 tax returns. Volunteer mileage is also deductible if you spend time driving to soup kitchens, hospitals, or shelters to volunteer time the miles are deductible at 14 cents per mile. Also any donations you may have made to a local bake sale, supplies for soldiers, or gifts to charity are deductible for the cost of supplies.

With the domino effect that the economy is experiencing it is important to save money where you can! There is no reason to pay more than necessary in taxes so hopefully some of these credits and deductions can be applied to your personal return.

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