About Polk County, OR

Tax Credit for Homebuyers
First-time homebuyers who purchase homes from the start of the year until the end of November 2009 may be eligible for the lower of an $8,000 or 10% of the value of the home tax credit. Remember a tax credit is very different than a tax deduction – a tax credit is equivalent to money in your hand, as opposed to a tax deduction which only reduces your taxable income.

The tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit if they sell their homes within three years.

Tax Credit Versus Tax Deduction

It’s important to remember that the $8,000 tax credit is just that… a tax credit. The benefit of a tax credit is that it’s a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a homebuyer were to owe $8,000 in income taxes and would qualify for the $8,000 tax credit, they would owe nothing.

Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a homebuyer is liable for $4,000 in income tax, he can offset that $4,000 with half of the tax credit… and still receive a check for the remaining $4,000!

Phaseout Examples

According to the plan, the tax credit starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000.

To break down what this phaseout means to homebuyers who are over those amounts, the National Association of Homebuilders (NAHB) offers the following examples:

Example 1: Assume that a married couple has a modified adjusted gross income of $160,000. The applicable phaseout to qualify for the tax credit is $150,000, and the couple is $10,000 over this amount. Dividing $10,000 by $20,000 yields 0.5. When you subtract 0.5 from 1.0, the result is 0.5. To determine the amount of the partial first-time homebuyer tax credit that is available to this couple, multiply $8,000 by 0.5. The result is $4,000.

Example 2: Assume that an individual homebuyer has a modified adjusted gross income of $88,000. The buyer’s income exceeds $75,000 by $13,000. Dividing $13,000 by $20,000 yields 0.65. When you subtract 0.65 from 1.0, the result is 0.35. Multiplying $8,000 by 0.35 shows that the buyer is eligible for a partial tax credit of $2,800.

Remember, these are general examples. You should always consult your tax advisor for information relating to your specific circumstances.

Homes that Qualify

The tax credit is applicable to any home that will be used as a principle residence. Based on that guideline, qualifying homes include single-family detached homes, as well as attached homes such as townhouses and condominiums. In addition, manufactured or homes and houseboats used for principle residence also qualify.

More good news – there is an extension on the additional tier of conforming loan amounts which had been first established in 2008. This tier of home loans are those greater than $417,000, and with a maximum that depends on the area, but is not greater than $729,750. These loans will again be eligible for rates that are slightly higher than conforming loan rates, but less expensive than the standard “jumbo” loan rates.

Additional Housing-Related Provisions

Tax Incentives to Spur Energy Savings and Green Jobs — This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation.

Landmark Energy Savings — This provision provides $5 Billion for energy efficient improvements for more than one million modest-income homes through weatherization. According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills.

Repairing Public Housing and Making Key Energy Efficiency Retrofits To HUD-Assisted Housing—This provision provides a total of $6.3 Billion for increasing energy efficiency in federally supported housing programs.Specifically, it establishes a new program to upgrade HUD-sponsored low-income housing (for elderly, disabled, and Section 8) to increase energy efficiency, including new insulation, windows, and frames.

Expanding Housing Assistance—This provision increases support for several critical housing programs. It includes $2 Billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.

More Help for Homeowners in the Future
Another thing to keep an eye on in the coming weeks is President Obama’s plan to help struggling borrowers before they are faced with a default on their mortgage.

According to reports, the Obama administration is discussing plans to help borrowers who are struggling to stay afloat, but who have not yet fallen behind on their payments. At this point, details are scarce; however, reports indicate that President Obama is looking to spend approximately $50 Billion to directly help homeowners before they face foreclosure and financial disaster.

While this is good news for individual homeowners, it will likely be good for the housing industry as a whole. That’s because, assisting struggling borrowers before they default should help stop the wave of foreclosures, which are estimated to top two million this year. That, in turn, will help stabilize home prices.

The Economic Stimulus Plan is huge, and impacts a number of industries. I’ve highlighted some of the major provisions that may impact you now and in the future.

If you are planning to visit one of the over 200 wineries scattered throughout the beautiful Willamette Valley, it's hard to know where to start. The Valley region is home to more than two thirds of Oregon's wineries and vineyards.

It's our moderate climate that makes this possible. We have warm summers with cool evenings; an Indian summer often shortened by maritime rains; wet, (did I say wet?) mild winters; and long, often rainy (have I said wet yet?) springs make for an extended growing season allowing the ripening process for wine grapes to be gradual. What ensues is complex fruit flavors and aromatics.

The Willamette valley is best known for their exceptional Pinot Noirs. Because of the similarities in our climate with the the Burgundy and Alsace regions of France, we have often been called the promised land for Pinot Noir in America and the world. But Oregon and the Valley also produce other varieties such as Pinot Gris, Pinot Blanc, Chardonnay, Melon, Riesling, Gewurztraminer, sparkling wine, Sauvignon Blanc, as well as Cabernet and Merlot.

On any given weekend, the wine tourist can choose from a variety of tasting tours, and in the summer many of the wineries host special events with live music. Many newlyweds are choosing wineries as the place to exchange vows or hold receptions. And, of course, it's also a fabulous way to spend a lazy day!

One of my favorite places is Stangeland Vineyard and Winery. Owned by the Miller family, this beautiful award winning vineyard is tucked away on a hillside just outside and northwest of Salem. Their handcrafted wines are produced utilizing the best of Old World traditional wine making methods, including aging in French oak barrels, as well as New World innovations.

Owner Larry Miller, an analytical chemist by trade, founded Stangeland in 1978, but the winery really began to take off in 1991. Encouraged, Larry began pouring all his funds from his position with Akzo Nobel into the winery while honing his craft. As in most ventures, the winery started out small, producing only 140 cases. As time progressed, the winery has grown to produce approximately 2700 cases annually.

Retired since 2006, Larry is able to pursue his dream full time. Stangeland wines are now distributed in Boston, Atlanta, Minneapolis, Los Angeles, Wisconsin, Oregon and most recently in Florida. They also exported 200 cases of wine to Norway for the first time, where Larry's grandparents originally immigrated from.

In a recent conversation with Larry, he said "It has been a long strange trip but I love what I do. In 2000 and 2001 Stangeland received gold medals for our 1998 and 1999 Pinot Noirs at the Mondial du Pinot Noir in Sierre Switzerland, a judging that contained nearly 800 pinots from 14 or 15 countries. The jury also had as many as 72 tasters from around the world mostly from Europe. After a 6 year dry spell, in 2008 we once again won a gold and silver in Sierre with our 2006 vintage Pinots. This time there were 1076 entries from 22 nations."

I'd say that's pretty darn impressive! I encourage you to drop by their tasting room, visit their website and join the Stangeland Wine Club. You can also view the catalog and order wine directly from the winery. Cheers!