Uncle Sam Savings for Baltimore Homeowners
Uncle Sam is making it simple for Baltimore homeowners to save on their taxes this year. If you’re a first time buyer, or a home makeover, there are several ways of savings out there.
Save The Environment and Money Too!
Be grateful to the $700 billion bailout strategy, going Green in 2009 can net you a quantity of juicy tax credits. Several Baltimore Homeowner encouragements that are particularly helpful for folks living in older Baltimore homes consist of:
Credit for 30 percent of the price tag of a photovoltaic solar energy system or a wind energy system a homeowner could receive up to $4,000 or 30 percent of the cost of installation of a home windmill system.
A $1,500 wonderful juicy tax credit for the installation of energy savings windows, doors, water heaters, roofs, insulation, heating, or a central air system in 2009 or 2010.
Sell Your Home and Pocket the Profit
Selling your home at a profit provides a juicy tax break if it was your main residence for at least two of the past five years. Singles don’t pay taxes on profits of up to $250,000, and married couples have a $500,000 threshold. If, you owned the home for less than two years you may still qualify for gain exclusion if you sold your home due to job, health or unforeseen circumstances (such as divorce or death). Ensure that you have the necessary documents to back up your claim, such as a doctor’s letter.
Your First Home Tax Credit
First time home buyers are entitled to a $7,500 tax credit if they earn less than $75,000 a year (couples may earn up to $150,000). If a buyer has not owned a home in the past three years, and falls in the eligible income range, they can take a tax credit worth 10% of the home’s sale price, up to a maximum of $7,500. This applies to Baltimore homes that have closed between April 9, 2008 and before July 1, 2009, and can be appropriated to either the 2008 or 2009 taxes.
Out of this world tax perk is that it is a true credit. If you owe $8,500 in taxes, the $7,500 credit comes off the top, leaving an amount owing of only $1,000. In addition, it is refundable, which means if you owe less than $7,500 in taxes, the government will send you a check for the difference.
Now, the bad news. Not only is this a refundable tax credit, but it’s also a loan. This represent that within two years buyers must begin paying it back at no more than $500 per year for 15 years. If the Baltimore home is sold during that time, the sum is withdrawn from the profit. If there is no profit, the loan slate will be wiped clean.
Save on Property Taxes
there are a few things a homeowner can do to potentially save on property taxes:
Look for blunder – up to half of property assessments are erroneous. Make certain that your ¾ acre property is not being assessed at 1 3/4 acre, or that you aren’t being charged for 4 bathrooms when you only have 2. What seems like a tiny dissimilarity could add up to big savings at tax time.
Property assessments are in general based on market value. If your home was assessed before housing prices fell, it should be re-assessed based on today’s market value. Do some probing and find out what similar homes in your area have been selling for. They should be in the same school district, have a similar lot size, same number of bedrooms and bathrooms. You will need to show that these similar houses have sold for less than the city’s assessed value of your home.
If you are paying more, file an appeal with your town. This is something you can do on your own, without spending money on lawyer’s fees. Pick up a property tax-cutback kit from the American Homeowners Association or the National Taxpayers Union and it will guide you through the process.
Posted by Carlos Sagastume on April 16, 2009. Filed under HUD Homes.
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