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About Learner8726

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  1. YES! I do learn stuff....tytyty That it was, a very short argument that I had with the title company regarding the time and use of the home and primary residency. Although, I was unable to get an answer from the title company as to why they, without question, originally selected to use the following a. option, instead of the b. option for determiniation of the amount to be withheld. It MAY be just easiest for them, especially if they are in a hurry? Humn... a. two percent (2%) of the sales price to the nearest dollar, or b. the net proceeds from the sale to the nearest dollar. Whether it was just an assumption made by the title company title company or not, it turns out that signing a letter of affirmation as to why the withholding is not taken (at all in our case) at closing seems to be another option that can be considered, without question, as well. No state withholding tax held. Thank you for taking what I make complicated much easier to understand.
  2. My husband and I are selling our house in Colorado and we are scheduled to close tommorrow at 1 p.m. We just found out that the title company (S****) will need an additional $5000 for Colorado state capital gains tax withholding because we are moving out of state (Missouri). I read the irs capital gains tax exemption qualifications and we CLEARLY qualify for the exemption amount and will NOT be required to owe for it. So, why does the state of Colorado (or is it the title company?) think (and or require) that this amount be withheld anyway?! Is there anything that we can do to prevent this withholding from taking place at closing? Stupid [This post has been edited to remove personal or identifying information. -Moderator]
  3. His boss - owner and broker with many investment properties and must be knowledgeable and experienced. Who likes to look like an idiot in front of the boss, right? My brother and I have been reading everything on the irs website about the tax credit and Although I generally confuse myself when reading any kind of guideline, I/"we" can't seem to find his scenero, well explained enough. . . The website Q & A says: Q. Can a taxpayer claim the first-time homebuyer credit if the purchase is pursuant to a seller financing arrangement (for example, a contract for deed, installment land sale contract, or long-term land contract), and the seller retains legal title to secure the taxpayer's payment obligations? A. If the taxpayer obtains the "benefits and burdens" of ownership of a residence in a seller financing arrangement, then the taxpayer can claim the credit even though the seller retains legal title. Factors that indicate that a taxpayer has the benefits and burdens of ownership include: 1. the right of possession, 2. the right to obtain legal title upon full payment of the purchase price, 3. the right to construct improvements, 4. the obligation to pay property taxes, 5. the risk of loss, 6. the responsibility to insure the property and 7. the duty to maintain the property. (7/2/09) "benefits and burdens" 1-7 - My brother appears to have some of these but not all 7 factors listed. In a contract for deed, is the buyer required to obtain all 7 of these factors in order to claim the credit on his taxes?
  4. My brother entered into a contract for deed to buy a house from his boss signed Aug. 2009. He paid his boss $5000.00 (which reduced the selling price of the house from $75,000 to $70,000) He makes $700/mo. pmts. (9.225% on 70,000) He doesn't have bad credit, he just doesn't have much of it. He resides on the property and is responsible for maintaining it and has 1st right to purchase home if defaulted. The contract doesn't seem to stipulate that he is responsible for paying taxes and insurance but does state that he is responsible to pay the seller for any increases to them if any at closing. (Also says, if any principal remaining it is to be applied to the principal balance) He did not get to claim the mortgage interest for 2009. He qualifies for the $8,000 tax credit, (in this case 10% so $7,000). I am wondering if this signed contract for deed qualifies as an acceptable binding contract for the April 30th deadline? Also, providing he can obtain a mortgage from a lender, can the seller use some of the proceeds from the sale to loan the buyer downpayment money at closing or is that kind of thing usually done on the side? He would be able to pay back the downpayment immediately after receiving his ammened 2009 tax return. (12-16 weeks for paper)
  5. A friend of mine purchased a home back in 2005 for 98,000. He made mortgage pmts and appears to have paid monthly into escrow for property tax and Insurance (Outragious PMI also included in his pmts.) He lost his job, quit making any and all mortgage pmts, Ins, and property tax payments back in 2007. He expected forclosure proceedings to follow soon after he stopped making payments but it never happened. In 2009, he says that he was sent the deed to his home. Buy a home + stop making payments then they send you the deed??????? He is back to work now and is saving his money to pay redemtion for property tax tien and hire a lawyer if he needs one. (Some guy/company paid (applied?) half the taxes cumulatively owed for the 2008.) The online public records are not detailed very well year to year but the land and home is assessed by the Missouri county for the past 5 years at about 20,500. The house isn't much to look at and needs alot of work. I am told that property is zoned commercial/residential and would appear that the land could easily appreciate in the future. I told him the go the county recorder of deeds to investigate any and all liens on property and to count on needeing a lawyer soon. I am just curious as to the possible reasons why a mortgage company would do something this!??? Not pursue forclosure? Send the defaulted borrower the deed? Was the mortgage company possibly doing something fraudulent? (ie. possibly to do with the outragious PMI?)
  6. The home (never rented out) was purchased Aug. 2005 and is used by the owner as his primary residence to date, April 2010. I think I am to understand that owning the home for 5 years would be owning the home anytime during the tax years of 2005-2010? If not and the house sold and closed in April 2010, (Hence 4 years and 8 months) then the regulation means that the proceeds do not qualify for the exemption. Correct?
  7. We currently are renting a home in Missouri and plan to buy a home here as soon as the Colorado house sells. It will be 5 years owning the home in Colorado this August. Right now it has only been owned for 4 years 8 months. I will reasearch the guidelines you sugested. Thank you very much!
  8. I am trying to make sense out of the federal and state income tax laws for the state of Colorado. My husband is selling our house (only primary residence with a mortage) in Colorado and I see in the realestate contract that the "IRS and State MAY withhold proceeds" from the sale in closing costs. My husband bought the home in 2005, refinanced in 2007. (There weren't any capital gains taxes withheld or paid in 2007 when he refinanced to take out 30,000 equity.) Now there is a potental buyer and if the house ends up selling for more than owed on the mortgage, do capital gains tax need to be paid/withheld at closing? Is it gross or net after commissions and closing costs? Terribly confusing (or written) tax laws about this right now. I think that I understand Colorado State capital gains are excluded from tax just for the year 2009 but federal makes little sense to me.
  9. Thank you for the clear explaination. I certainly could qualify for insolvent. I could possibly even end up without a single W-2 for the 2009 tax year. I currently have no assets in my name and a dormant bank account. Does a person have to be proven insolvent for the IRS record? Does being declaired insolvent reflect on your personal credit report? I am so far, effectively but slowing rasing money to pay this judgment through means of consignment. (i.e. personal items purchased at garage sales, thrift stores and goodwill that I can repair and perfect for sale at consignment stores) profit is small, but still profit. Could/should this exclude me from insolvency?
  10. I am a judgment debtor in a civil debt collection case. After having lost my case I wrote a letter to the judgment creditor asking them to furnish me with an itiemized dollar amount needed to satisfy the judgment. They replied with an amount totaling $2,633 which includes principal amount, interest, court costs and attorney fees. The reply letter also listed 2 options to pay. One option was to pay a lump sum of $2000. The other was $150 per month (no more interest added after first payment) until the full balance is paid. I did not ask them if they would accept less than the amount of the judgment...they offered the option. My question is, what could be the tax consequence for paying less than the amount of the judgment? Is there an amount up to a forgiven $600 that does not require being reported to the IRS? Is it best to report the amount forgiven to the IRS regardless of the amount?
  11. To my understanding of our state statute, Colorado legal and judgment interest is 8% per annum. The judgment order says interest will continue at 8% per annum until paid. I am understanding how the Judgment creditor calculated his interest (although not exactly sure why it is compounded monthly in stead of annualy) starting with what he says is a principal balance that begins on a date when the account was purchased from one of the previous collection agencies in April of 2007. I thought I might be able to figure out how much my original principal balance was if I calculated backwards from the current amount owed at judgment. The judgment creditor stated that the amount owed of $1860.00 was the principal amount owed on 11/04, (as stated by plaintiffs assignor) 04/07 (date plaintiffs assignor purchased account), 11/15 (date plaintiff purchased account) as well as 12/18/08 (DV letter). Isn't the principal amount supposed to change once you add compounded interest?
  12. This makes very helpful sense to me. Thank you.
  13. "While I know the posts here that you are trying hard to avoid giving the creditors any information regarding your husband, some of that information the judgment creditors are allowed to get. You may wish to see a Colorado attorney about the possibility of blacking out certain information on the return copy related solely to your husband, like his SSN for example." It seems it could be unconstitutional that a state's county court should have the authority to require an judgment debtor to devulge personal information (employment history, income, full name, ss#...etc.) of someone else when according to the particular state's statutes, that persons information can in no way be liable or used by the judgment creditor in connection with the judgment. Having to produce this kind of personally identifiable information to someone with a reputation (judgment creditor, Junk-debt buyer) for falsely reporting information to credit bureau's, selling or easily capable of misusing that information, should not be a allowed. Do I need to (Is there?) locate a federal or some other kind of non-community property state law (Colorado) that gives my husband the civil right not to produce his personally identifiable information?
  14. My husband did file us jointly but now he refuses to give me the return (I don't blame him) with his personal information included. What happens to me if I am unable to provide information requested?
  15. If we filed a joint tax return, does this mean that the judgment creditor could put a lein on our taxes? Possibly make my husband liable?
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