Monday, June 28 2010
A restaurant at Marina Pointe had a soft opening to the public after a fire closed the previous venue for more than 9 months.
It was an early morning fire in September of 2009 that destroyed the Tin Fish restaurant at Marina Pointe.
The heat did not discourage people from coming out to the soft opening of the new restaurant which features a pizza restaurant and a bar. It also has a view of Evansville's skyline.
Sunday, June 27 2010
The Report, found online at www.IndianaIsHomge.com, was the first-ever county-by-county comparison of existing single-family home sales in Indiana. In March, statistics on other types of existing, single-family home sales - condominiums, duplexes, townhomes, mobile homes, etc. - was added to the report.
IAR obtains the data directly from 26 of the state's 27 Multiple Listing Services (MLSs), including the Broker Listing Cooperative® (BLC®) in central Indiana. To date, the Report represents 98% of the housing market statewide and 91 of 92 Indiana counties.
Statewide, May sales of all types of existing, single-family homes increased 25.9% from the same month last year; median prices saw an increase of 5%. This is the third consecutive month that there has been an increase in sales and the eighth consecutive month that there has been an increase in median prices over the previous year.
"Because those who took advantage of the federal tax credit have until June 30th to close their transaction, we don't yet have a clear idea of what the credit's expiration will mean to our local markets," said Karl Berron, Chief Executive Officer. "Over the next few months, our reports will become more robust, including information on pending sales and other indicators that will help us understand impact of the tax credit.
"The good news is that median prices did enjoy a welcomed five percent increase over last May," continued Berron. "Regardless of the availability of the tax credit, we expect prices to remain relatively stable with the potential for some softness if demand indicators continue to wane."
In coming months, as Berron mentioned, the Report will include information on new listings, pending sales, average sales price, percent of original list price received at sale, housing affordability and month's supply of inventory.
Reportisode #9, archived along the right side of the Reports tab at www.IndianaIsHome.com, is still of interest. It talks about the other incentives available to help consumers achieve their dream of homeownership, namely the Market Stabilization Program created by the Indiana Housing & Community Development Authority (IHCDA) to minimize the negative effects of foreclosures in many Hoosier communities. That program runs through the end of June.
More about "Indiana Is Home"
It is a multi-media project hosted by media professional Pat Carlini and aimed at keeping Hoosier homeowners, would-be homeowners, policymakers and the media well-informed on the ever-changing local real estate markets. Indianapolis-based Boost Media and Entertainment shot and produced all videos found at www.IndianaIsHome.com.
Saturday, June 26 2010
Existing-home sales remained at elevated levels in May on buyer response to the tax credit, characterized by stabilizing home prices and historically low mortgage interest rates, according to the National Association of REALTORS®. Gains in the West and South were offset by a decline in the Northeast; the Midwest was steady.
Existing-home sales, which are completed transactions that include single-family, townhomes, condominiums, and co-ops, were at a seasonally adjusted annual rate of 5.66 million units in May, down 2.2 percent from an upwardly revised surge of 5.79 million units in April. May closings are 19.2 percent above the 4.75 million-unit level in May 2009; April sales were revised to show an 8.0 percent monthly gain.
Buyers Face Purchasing Delays
Lawrence Yun, NAR chief economist, said he expects one more month of elevated home sales. “We are witnessing the ongoing effects of the home buyer tax credit, which we’ll also see in June real estate closings,” he said. “However, approximately 180,000 home buyers who signed a contract in good faith to receive the tax credit may not be able to finalize by the end of June due to delays in the mortgage process, particularly for short sales.
“In addition, many potential sales are being delayed by an interruption in the National Flood Insurance Program. Florida and Louisiana, also impacted by the oil spill, have the highest percentage of homes that require flood insurance.”
As the leading advocate for homeownership issues, NAR is supporting Senate amendments to extend the home buyer tax credit closing deadline through September 30 for contracts written by April 30, and to renew the flood insurance program. “Sales and related local economic activity would have been higher without delays in the closing process or flood insurance issues,” Yun noted.
Housing Still Affordable
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage fell to 4.89 percent in May from 5.10 percent in April; the rate was 4.86 percent in May 2009.
The national median existing-home price for all housing types was $179,600 in May, up 2.7 percent from May 2009. Distressed homes slipped to 31 percent of sales last month, compared with 33 percent in April; it was also 33 percent in May 2009.
NAR President Vicki Cox Golder said home prices have been stabilizing all year. “With distressed sales at roughly the same level as a year ago, the gain in home prices is a hopeful sign that the market is in a good position to stand on its own without further government stimulus,” she said. “Very affordable mortgage interest rates and stabilizing home prices are encouraging home buyers who were on the sidelines during most of the boom and bust cycle.”
Pending home sales are expected to decline notably in May and June from the spring surge, but Yun added that job growth and a manageable level of foreclosures are keys to sales and price performance during the second half of the year.
A parallel NAR practitioner survey shows first-time buyers purchased 46 percent of homes in May, down from 49 percent in April. Investors accounted for 14 percent of transactions in May compared with 15 percent in April; the remaining sales were to repeat buyers. All-cash sales were at 25 percent in May, edging down from a 26 percent share in April.
Total housing inventory at the end of May fell 3.4 percent to 3.89 million existing homes available for sale, which represents an 8.3-month supply at the current sales pace, compared with an 8.4-month supply in April. Raw unsold inventory is 1.1 percent above a year ago, but is still 14.9 percent below the record of 4.58 million in July 2008.
Single-family home sales declined 1.6 percent to a seasonally adjusted annual rate of 4.98 million in May from a pace of 5.06 million in April, but are 17.5 percent above the 4.24 million level in May 2009. The median existing single-family home price was $179,400 in May, which is 2.7 percent above a year ago.
Single-family median existing-home prices were higher in 16 out of 20 metropolitan statistical areas reported in May from a year ago. In addition, existing single-family home sales rose in 18 of the 20 areas from May 2009.
Existing condominium and co-op sales fell 6.8 percent to a seasonally adjusted annual rate of 680,000 in May from 730,000 in April, but are 32.6 percent above the 513,000-unit pace in May 2009. The median existing condo price was $181,300 in May, up 3.4 percent from a year ago.
Source: NAR http://www.realtor.org/RMODaily.nsf/pages/News2010062201?OpenDocument
Friday, June 25 2010
Holiday World & Splashin' Safari in Santa Claus has named a new president and chief executive officer. Dan Koch is taking over following the sudden death of his brother Will last week. Dan Koch is a lawyer in Florida and plans to make regular trips to Santa Claus.
SANTA CLAUS, IND-----Holiday World & Splashin’ Safari will continue to be owned and operated by the Koch family “into perpetuity,” according to the park’s new president and CEO, Dan Koch.
Koch, 46, takes the helm following the sudden death of his brother Will earlier this month.
“Will and I have been business partners for decades and have spoken on the phone daily for more than 30 years,” says Koch. “I consider it an honor to step in as president and continue the expansion plans my brother and I crafted together. In the meantime, Will’s three children will have time to finish their education and learn more about the family business before they decide how they would like to be involved in the future of the park.”
“Our company was reorganized two years ago, when Will promoted two of our park directors to general managers,” says Koch. “These GMs will keep the park running smoothly as we move into the heart of the season and prepare for next year.”
Koch adds he plans to “stay the course” with Holiday World & Splashin’ Safari’s long-range expansion plans, community involvement, and philanthropic efforts.
Koch is a partner in the law firm Koch & Trushin in Fort Lauderdale, Florida. He plans regular trips to the Santa Claus park and daily communication with management. He is married and has two young children.
Along with his four siblings, Koch grew up in the town of Santa Claus; his first job was playing a costumed elf at Santa Claus Land, as Holiday World was called prior to 1984. His other seasonal jobs at the park included working in the games department, helping on the parking crew and hauling trash. He graduated from Heritage Hills High School in 1982 and the University of Miami in 1986 with a degree in Business Administration and Finance. Following a year working fulltime at Holiday World, Koch returned to the University of Miami, where he earned a law degree in 1990. He practiced law in Miami for 15 years before opening Koch & Trushin law firm in 2005.
Holiday World & Splashin' Safari are open daily for the season, featuring the new Wildebeest, the world’s longest water coaster. For more information, visit www.holidayworld.com or call 1-877-Go-Family.
If you would rather not receive future communications from Holiday World & Splashin' Safari, let us know by clicking here.
Source: Holiday World & Splashin' Safari & Inside INdiana Business
Thursday, June 24 2010
Toyota Motor Manufacturing Indiana Inc. (TMMI) is planning to add 100 new temporary production workers. The hiring effort follows an announcement that Highlander production at the Princeton facility will increase. Our partners at the Evansville Courier & Press report TMMI has not hired any production workers since 2006.
It released approximately 370 temporary workers in 2007.
The hiring of the 100 temporary workers in the coming weeks is being handled by Toyota's staffing agency Aerotek.
Those jobs could become permanent if Toyota vehicle demand continues to improve.
Wednesday, June 23 2010
Evansville-based Old National Bank (NYSE: ONB) is joining AT&T, Intel and Campbell's Soup as a recipient of the 2010 Corporate Engagement Award of Excellence. The Points of Light Institute chose the companies for their volunteer efforts to solve community problems. Old National will be honored at the National Conference on Volunteering and Service June 29 in New York City.
Evansville, Ind., June 17, 2010… Old National Bank (NYSE: ONB) joined AT&T, Intel and Campbell’s Soup as a recipient of the 2010 Corporate Engagement Award of Excellence, which is presented annually by the Points of Light Institute. This prestigious national award honors companies for their extraordinary employee volunteer efforts to solve community problems.
The Points of Light Corporate Engagement Award of Excellence, established in 1993, is recognized as one of the most prestigious awards that can be bestowed upon a U.S. company in recognition of community partnership and corporate engagement. The award supports the mission of the Points of Light Institute: to inspire, equip, and mobilize people to change the world through volunteer service.
“We are incredibly proud and humbled that Old National Bank has been chosen for this prestigious honor,” said Bob Jones, Old National President and CEO. “It is a testament to our associate commitment to community leadership and service, and a powerful illustration that you don’t have to be a big company to make a big impact in the community.”
Jones continued, “Being a community bank in 2010 and beyond is about far more than meeting the financial needs of families and businesses. It requires a true passion for community service and a commitment to servant leadership. For us, it’s also about empowering and encouraging our associates to be every bit as engaged in community organizations, activities and causes as we are as a company.”
Old National will be recognized and officially receive the award at the National Conference on Volunteering and Service on June 29 in New York City. The conference is the world’s largest gathering of volunteer and service leaders from the nonprofit, government and corporate sectors.
“As we continue to usher in a renewed surge of civic engagement, we are seeing an impressive number organizations stepping up and answering the call to service,” said Michelle Nunn, CEO of Points of Light Institute. “It is truly inspiring to see companies leading the way, leveraging their unique assets and mobilizing their employees to make a meaningful difference in their communities.”
Community Leaders Respond to Old National’s Achievement
“Old National Bank has strived to develop far-reaching, actionable community programs to significantly increase Americans’ understanding of their financial opportunities within their communities,” said Doug Gibbens, Executive Director, Indiana Committee of Employer Support of the Guard and Reserve.
“Old National Bank provides countless volunteer hours to support the needs of the Evansville Vanderburgh School Corporation students and families,” said Cathlin Gray, Associate Superintendent – Family, School and Community Partnerships. “In 2009 alone, they logged more than 770 volunteer hours supporting EVSC initiatives. Old National Bank, under the leadership of Bob Jones, serves as an example of corporate engagement at its best.”
About Points of Light Institute
About Old National Bancorp
Source: Old National Bancorp & Inside INdiana Business
Tuesday, June 22 2010
Job growth in Indiana is receiving national attention. The Wall Street Journal reports the state has experienced the largest percentage increase in the nation in jobs over the past year. The 1.9 percent increase is due mainly to an increase in manufacturing jobs.
The article follows last week's release of the state's May unemployment report, which showed Indiana's jobless rate remained at 10 percent.
It also indicated private sector employers throughout the state recorded 6,3000 additional jobs in May.
The Indiana Department of Workforce Development also says total private sector employment has increased 2.1 percent since December, with a total gain of 47,900 jobs.
DWD says that accounts of 10 percent of total U.S. private sector job growth over the past five months.
Saturday, June 19 2010
For the first time in more than a month, the number of mortgage applications to purchase homes rose last week.
On an adjusted basis, the Mortgage Bankers Association purchase index increased 7.3 percent compared to the previous week. On an unadjusted basis it was up 17.4 percent. Compared to the same week last year, applications declined 31.3 percent.
Michael Fratantoni, MBA’s vice president of research and economics, was reluctant to declare this a trend. “While it is clear that purchase applications in May dropped sharply as a result of the tax credit induced increase in applications in April, it is unclear whether we are seeing the beginnings of a rebound now,” he said.
Mortgage rates were up slightly last week:
Source: Mortgage Bankers Association 06/16/2010) http://www.realtor.org/rmodaily.nsf/pages/News2010061602?OpenDocument
Friday, June 18 2010
The FBI says it will renew its efforts to end mortgage fraud. A spokesman said last week that the FBI anticipates arresting hundreds in crackdowns scheduled over the coming weeks.
Offenses agents expect to find range from schemes that encourage borrowers to lie about their incomes to scams that rely on falsifying foreclosure information.
The FBI has set up 23 fraud task forces across the U.S. to carry out the anticipated sweep.
Source: Financial Times (06/11/2010) http://www.realtor.org/RMODaily.nsf/pages/News2010061403?OpenDocument
Thursday, June 17 2010
An Evansville school has been listed among the top 10 in Newsweek's 2010 rankings of America's Best High Schools. Signature School is seventh on the list. It was created in 2002 as the state's first charter high school. Several schools throughout Indiana are included in this year's rankings.
The Signature School is public, with open admission. But there has been a lottery for incoming freshmen over the past two years because there have been more applicants than openings.
The school is comprised of three downtown buildings.
Newsweek ranks high schools each year based on how hard students are challenged. Only 6 percent of the public schools throughout the country have made the list.
Source: Newsweek & Inside INdiana Business http://www.insideindianabusiness.com/newsitem.asp?ID=42175
Wednesday, June 16 2010
As I said last month, sales in March and April were spectacular! Many of the contracts written in those months closed in May. Closed volume in May was at its highest level since June of 2007 and was $10 million higher than any month in over two years. All those closings also reduced our month’s supply of inventory to just over 6 months supply. That means our inventory of homes is at its lowest level in almost 4 years. All of that is great news, but real estate results and conditions should not be measured based only on one or two month’s activity. A longer period of time gives us a more accurate picture. Pended transactions declined significantly in May, partially as a result of the expiration of the tax credit. Closings will still be healthy in June, just not at May levels.
The key question now is where do we go from here? Although we will not see results like March and April anytime soon, there are several reasons, according to The Kiplinger Letter, to believe that housing sales are on a steady but slow increase. First home prices are very affordable. It now takes about 18% of the typical household income to meet principal and interest payments on a single family home which compares favorably with the long term average of 26%. Second, consumer confidence is improving which is critical to expensive, long term commitments, like home purchases. As I said a couple of months ago, three quarters of Americans believe now is a good time to buy. Third, there is a consensus that credit conditions will ease and that mortgage interest rates will remain at their very low level for several more months. We won’t, and we shouldn’t, go back to the freewheeling days of 2007 but a slight loosening of credit can be helpful without creating unreasonable risks.
The best tip I can give you about shopping for homes is to start at www.TheTrentiniTeam.com or www.FCTuckerEmge.com We just enhanced and enlarged the size of pictures on all listings and are in the process of making several other improvements which we will roll out later this year.
Kathy and I would like to take this opportunity to whish you happy summer holidays and above all safe travels.
Tuesday, June 15 2010
The president of Holiday World and Splashin' Safari is being remembered as a business visionary, caring boss and strong community supporter. Will Koch died suddenly Sunday of what his family believes to be complications from diabetes. Holiday World Spokeswoman Paula Werne says under Koch's leadership, the park went from annual attendance of 300,000 to more than one million.
Holiday World & Splashin’ Safari owner and president, Will Koch, passed away Sunday evening at his home.
“Will was not only our leader, he was our dear friend,” says park spokesperson Paula Werne. “Our park family is in mourning for this sweet man who worked tirelessly to bring fun and happiness to so many families in the 20 years he ran the park.”
Koch died at home of what the family believes to be complications from diabetes. He was 48.
“The Koch family wants to assure the public that Holiday World & Splashin’ Safari will be open today and will continue to be owned and operated by his family,” says Werne. “We know that’s what Will would have wanted.”
Born and raised in the town of Santa Claus, Koch attended Heritage Hills High School in Lincoln City, and was Valedictorian of his graduating class in 1979. He graduated with honors from the University of Notre Dame in 1984 with a B.S. in Electrical Engineering. In 1986, he received a Master's degree in Computer Science from the University of Southern California.
Koch was Chief Executive Officer of Koch Development Corporation, the parent company of Holiday World Theme Park and Splashin' Safari Water Park. Under his direction, the theme park followed an aggressive growth program including the addition of Splashin' Safari Water Park in 1993, The Raven and The Legend wooden roller coasters in 1995 and 2000, plus The Voyage wooden coaster in 2006, for which he was a designer. In 2004, Koch received the international Applause Award from the amusement industry; the criteria for the coveted award include foresight, originality and creativity, plus sound business development and profitability. Each year since 2006, annual seasonal attendance at Holiday World & Splashin' Safari has topped one million visitors. This year, the park premiered Wildebeest, the world’s longest water coaster.
Koch served as president of the Lincoln Boyhood Drama Association, which worked with the State of Indiana to reopen the Lincoln Amphitheatre in 2009 with a new drama honoring the bicentennial of Abraham Lincoln’s birth. He was also a past member of the Board of Directors of the International Association of Amusement Parks & Attractions; and he served on the Administrative Council of the Santa Claus United Methodist Church.
Koch is survived by his wife, Lori, and three children: Lauren, Leah, and William. He is also survived by his mother, Pat, and siblings Dan, Kristi, Philip and Natalie.
In lieu of flowers, the family asks for donations to be made to the Lincoln Boyhood Drama Association or the Juvenile Diabetes Research Foundation. Funeral arrangements are pending.
Source: Holiday World & Splashin’ Safari & Inside INdiana Business http://www.insideindianabusiness.com/newsitem.asp?ID=42149
Friday, June 11 2010
Pedestrian-friendly neighborhoods within walking distance of schools, parks, and businesses may be more valuable than similar homes built where residents must drive to those amenities, according to a study by CEOs for Cities, a national network of civic, business, academic, and philanthropic leaders working to improve cities.
A mix of common daily shopping and social destinations within a short distance added from $4,000 to $34,000 to home values, according to findings in the study, “Walking the Walk.”
What makes a community walkable?
Dan Burden, founder of Walkable Communities, has developed a 12-step checklist for defining, achieving, or strengthening a walkable community. Among the items on his list: a welcoming public space where people can gather and socialize, speed-controlled key streets, pedestrian-centric design, and a town center with a wide variety of shops and businesses.
Safety and walkability
Although you can’t physically move your neighborhood closer to amenities, there are things you can do to raise its walkability factor.
In addition to making safety improvements, you can also try these tips for improving walkability from John Wetmore, producer of Perils For Pedestrians Television:
A relatively low-cost way to get people walking in your neighborhood is to organize walk-to-school or walk-to-work events. International Walk to School in the USA offers a good planning guide with ideas for events that you can plan in as few as seven days.
Sacha Cohen is a Washington, D.C.-based writer and founder of DCGoingGreen.net and grassfed media. She has written about sustainable travel, green buildings, and green communities for such outlets as The Washington Post and Planet Green.
Thursday, June 10 2010
The Federal Reserve’s periodic survey of economic conditions, known as the Beige Book, this week reported growth in all 12 regions for the first time since 2007.
New York. Commercial real estate leasing has picked up noticeably although vacancy rates continue to rise in some areas. Residential rents appear to have bottomed.
Wednesday, June 09 2010
Working with a contractor takes effort and know-how in order to keep your project on time and on budget.
You’ve chosen a great contractor, you have a clear and well-designed project plan, and now you’re ready to sit back and watch your dreams become a reality. Unfortunately, the hardest part of your job has yet to begin. No matter whom you’ve hired to construct your home improvement project, you’re going to have to actively manage the process in order to keep it on target, on time, and on budget.
Get apathetic or lose your focus for even a single day and you may pay for it—quite literally. Here’s what you need to know to stay organized and maintain strong communications with your contractor and construction team.
An allowance is a line item in the contractor’s bid for something that’s yet to be determined. Let’s say you haven’t chosen your plumbing hardware for your new master bathroom or the decking you’ll use for your new three-season porch. The contractor will put a number in the budget as a placeholder. But with such a wide range of price points for these products, his guess may be far lower than what you wind up spending, which can lead to cost overruns. Try to eliminate allowances by sorting out all of your material and product selections before the contractor gives you an itemized bid for the job. Otherwise, at least do enough shopping to give the contractor an accurate ballpark price for the materials you’re considering.
Establish a communication routine
Ask the contractor how he prefers to communicate with you. Depending on the size of the job and how his team operates, he may say that he’ll be on site to talk with you every morning before you leave for work. He may give you his cell phone number and say, “call me anytime,” or tell you that his foreman can handle whatever comes up. In any case, try to meet with the project leader at least once a day. This is an opportunity for you to hear progress reports and find out what work is scheduled over the coming days—and to ask your questions and voice any concerns you have.
Keep a project journal
Part scrapbook, part diary, part to-do list, a project journal will help you stay organized. Use a notebook to record progress, note things you want to ask your contractor, jot down ideas, record product order numbers, and anything else that comes along. It’ll help you keep things on track, communicate with the team, and provide a record of exactly who said what when—which could help you iron out disagreements later on.
Track all changes in writing
No matter how thorough your planning is, your home improvement job will inevitably evolve as it moves along. You may encounter unforeseen structural issues, or you may decide to include additional work as you see the project take shape. Any good contractor can handle these changes—just make sure that he bids them in writing first. Tell the contractor at the outset (and put in the contract) that you want to sign off on written change orders for anything that’s going to add to the bottom line of the job. That means he has to give you a bid (a description of the change and a fixed price for what it will cost) and you both have to sign it before the work is done. This eliminates the risk of expensive changes happening without clear communication about how much more you’re spending, and it helps you keep track your bottom line from one change to the next.
Check their work
It’s much easier to nip problems in the bud than to undo mistakes after the fact, so try to be proactive about checking your contractor’s work. As fixtures arrive on site, compare the model numbers on the boxes against your receipts, invoices, and the contractor’s bid to ensure that the right product was delivered. As walls get framed, check their locations and the locations of window and door openings against the blueprints. To the extent that it’s possible, conduct these investigations after hours or during lunch breaks so you don’t seem like you’re looking over the workers’ shoulders (even though you are).
Pay only for completed work
Money is power. As soon as you’ve paid the contractor, you no longer have the upper hand, so it’s crucial that you keep the payment schedule in line with the work schedule. The contract should establish a series of payments to be made when certain aspects of the job are completed. For example, your contract could stipulate that you’ll pay in three equal installments, with the last payment to be made after the project is complete, and after you and your contractor agree the work is satisfactory. Never put down more than 10% upfront; that’s too much cash to hand over before any work is complete. Your contractor should be able to get any necessary supplies on credit.
Be a good customer
One of the best ways to get quality work out of a construction crew is to make them enjoy working for you. That means being decisive with the contractor—and giving him a check promptly at the agreed-to points in the project. It also means being friendly and accommodating of the workers in your house: designating a bathroom that they can use, greeting them by name each morning, and perhaps serving them cold lemonade on a hot day. Complimenting their work (as long as you feel it’s worthy of praise) can be a great way to motivate them to do their best for you.
A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.
Sunday, June 06 2010
Saturday, June 05 2010
Many Americans are dealing with the stress of being in debt and their credit score is suffering as a result.
Thursday, June 03 2010
Working from home can offer many advantages including tax deductions, just take care what you try to write off for your home office on your return.
If you work from home, even on a part-time basis, you can probably save a few dollars come tax time. That’s because if you itemize your deductions on your federal tax return, you can write off as a business expense part of the cost of owning and operating your home. Everything from electric bills to property taxes may be fair game.
Those tax deductions can add up, thus lowering your taxable income and reducing the amount you owe Uncle Sam. Before you start spending that refund, however, there are a few rules you need to understand and heed. It’s a good idea to consult a tax adviser to be sure that you’re filing the right schedules and maximizing your deductions.
Passing the IRS litmus test
To meet IRS guidelines, your home office must be your principal place of business, or the place you see clients in the normal course of business. Parts of your home you use to store products or equipment for your business also count. That doesn’t mean that all your work has to be done from home. If you’re an outside salesperson, you probably spend most of your work time elsewhere. But if you do you billing and return customer calls primarily from your home, your home office should qualify.
Measuring your home office
The amount you can deduct for your home office depends on the percentage of your home used for business. Your work space doesn’t need to be a separate room—a table in a corner qualifies. But it has to be an area that’s used solely for business. The tax break also covers separate structures on your property, like a detached garage you’ve converted to an office. Unlike an office inside your home, a separate structure doesn’t have to be your main place of business to qualify for a deduction. That’s because the IRS believes your family is less likely to use a separate structure as a part-time play area or den, says Mark Luscombe, principal analyst for tax and consulting at CCH.
What can you deduct?
Once you’ve figured out what percentage of your home you use for business, you can apply that percentage to different home expenses. These include:
Just take each expense and multiply it by your home office percentage (the 5% mentioned above). That’s the amount you can deduct as a business expense. So if you spend $150 a month on electricity, you can deduct $7.50 as a business expense. That adds up to a $90 deduction per tax year. If your annual business expenses total $10,000, your deduction is $500. In 2009, lowering your taxable income by $500 to $99,500 would’ve cut your tax bill by $113.
Don’t forget depreciation
Depreciation is based on the idea that everything—even something like a home—wears out eventually. To figure home office depreciation, start by calculating the tax basis of your home: generally the purchase price plus the cost of improvements, minus the value of the land it sits on. Next, multiply the tax basis by the percentage of your home used for work. This gives you the tax basis for you home office. Finally, multiply that by a depreciation percentage that’s set periodically by the IRS. There are caveats. For a crash course, read IRS Publication 946 or talk to a tax professional.
This article provides general information about tax laws and consequences, but is not intended to be relied upon by readers as tax or legal advice applicable to particular transactions or circumstances. Readers should consult a tax professional for such advice, and are reminded that tax laws may vary by jurisdiction.
Donna Fuscaldo has written about personal finance for more than decade for Dow Jones Newswires, the Wall Street Journal, and Fox Business News. She’s currently a freelance writer with her own home office.
Thursday, June 03 2010
Home equity loan and refinancing scams can cost you more than money—these scams can cost you your house.
Refinancing a mortgage to a lower interest rate can make sense for some homeowners. So too can taking out a home equity loan against the value you’ve built up, perhaps to finance a kitchen remodel or pay Junior’s college tuition. What doesn’t make sense is losing your home because you fall for home equity loan and refinancing scams such as loan flipping and equity stripping. Although scam artists can be very convincing, homeowners who know what to look out for are less likely to become victims.
Loan flipping is a scam targeted at homeowners looking to get money back when they refinance a mortgage. This is often referred to as a cash-out refi. Scammers take advantage of this desire to tap the equity in a home to pay for things the homeowner couldn’t otherwise afford.
Equity stripping can occur in several ways, but at its heart is a scam artist who gains ownership of your home, borrows against it or sells it, pockets the proceeds, and disappears. You’re often left with a hefty mortgage balance and no place to live.
Watch out for unsolicited offers to refinance from companies claiming government affiliations. In particular, don’t be fooled by the use of official-sounding acronyms like “TARP” or official-looking website addresses. Scammers use these to gain your trust. Once they do, they’ll likely try to charge you for access to government assistance. Worse, they might extract enough personal information to commit identity theft.
New disclosure rules make spotting scams easier
Many unscrupulous lenders have relied on confusing paperwork to dupe borrowers into paying excessive upfront fees on loans. Others would pull last-minute rate switches at closing. Still others would disguise prepayment penalties, which can prove costly if you ever try to refinance again or retire a loan early.