Greetings from Jennifer Ross - Realtor
The summer flew
by and I can't believe the holidays are almost here! Real estate has
kept me hopping but I managed a couple of fun vacations to the wine
country & Santa Barbara. I remodeled a 1929 Tudor home from
top to bottom, then moved into the home...never a boring moment!
My daughter "Alex" is back in New York at Syracuse
University getting ready for her second semester of school in
Florence Italy! I hope to join her in the spring for a couple
of weeks. My son Eliot is training in biopharmaceutical I.T.
and seems to be enjoying his new job.
I'm looking forward to my favorite holiday, Halloween - I love
dressing up, eating chocolate and watching the kids!
The Winner of This Month's Drawing Is...
and Joe Towers!
Joe have won a $50 restaurant gift
The next drawing will be in a few weeks......
News & Views
Association of Realtors reports the median list price of a home in
San Diego County hit $374,995 in September, a 4.16 percent increase
from a year ago. Perhaps the most interesting item in the report
showed the active inventory of homes for sale in San Diego last month
was 9,519 units, down nearly 35 percent from last year at this time.
It looks like
the housing construction sector is coming back to life. The Commerce
Department reported this week new home construction activity rose by
15 percent in September to an annualized rate of 872,000 units, the
highest level in four years. Also, building permits, a sign of future
construction activity, were up 11.6 percent with the biggest increase
in multifamily housing. Housing construction has been the missing
link in the economic recovery. Building is a big jobs generator and
the benefits to related industries -- like home improvement centers
-- has an immediate impact on the economy.
favorite story of the day: Beth Feeback, an artist in North Carolina,
paid $10 for two paintings at a Goodwill store. She was really buying
the canvases because they were cheaper than new ones and she figured
it would be easy to paint over what was already there. Fortunately
she decided to Google the name of the artist on the paintings and it
turned out Ilya Bolotowsky is a rather well-respected artist and
Sotheby's told Feeback the paintings are worth up to $20,000.
Top Ten Things You Need to
Know About the 3.8% Tax
Beginning January 1, 2013, a new 3.8 percent tax on some investment
income will take effect. Since this new tax will affect some real
estate transactions, it is important for us to clearly understand the
tax and how it could impact us. It's a complicated tax, so you won't
be able to predict how it will affect every buyer or seller.
Understand that this tax WILL NOT be imposed on all real estate
transactions, a common misconception. Rather, when the legislation
becomes effective in 2013, it may impose a 3.8% tax on some (but not
all) income from interest, dividends, rents (less expenses) and
capital gains (less capital losses). The tax will fall only on
individuals with an adjusted gross income (AGI) above $200,000 and
couples filing a joint return with more than $250,000 AGI.
you add up all of your income from every possible source, and
that total is less than $200,000 ($250,000 on a joint tax
return), you will NOT be subject to this tax.
3.8% tax will NEVER be collected as a transfer tax on real estate
of any type, so you'll NEVER pay this tax at the time that you
purchase a home or other investment property.
NEVER pay this tax at settlement when you sell your home or
investment property. Any capital gain you realize at settlement
is just one component of that year's gross income.
you sell your principal residence, you will still receive the
full benefit of the $250,000 (single tax return)/$500,000
(married filing joint tax return) exclusion on the sale of that
home. If your capital gain is greater than these amounts, then
you will include any gain above these amounts as income on your
Form 1040 tax return. Even then, if your total income (including
this taxable portion of gain on your residence) is less than the
$200,000/$250,000 amounts, you will NOT pay this tax. If your
total income is more than these amounts, a formula will protect
some portion of your investment.
tax applies to other types of investment income, not just real
estate. If your income is more than the $200,000/$250,000
amount, then the tax formula will be applied to capital gains,
interest income, dividend income and net rents (i.e., rents
tax goes into effect in 2013. If you have investment income in
2013, you won't pay the 3.8% tax until you file your 2013 Form
1040 tax return in 2014. The 3.8% tax for any later year will be
paid in the following calendar year when the tax returns are
any particular year, if you have NO income from capital gains,
rents, interest or dividends, you'll NEVER pay this tax, even if
you have millions of dollars of other types of income.
formula that determines the amount of 3.8% tax due will ALWAYS
protect $200,000 ($250,000 on a joint return) of your income
from any burden of the 3.8% tax. For example, if you are single
and have a total of $201,000 income, the 3.8% tax would NEVER be
imposed on more than $1,000.
true that investment income from rents on an investment property
could be subject to the 3.8% tax. BUT: The only rental income
that would be included in your gross income and therefore
possibly subject to the tax is net rental income: gross rents
minus expenses like depreciation, interest, property tax,
maintenance and utilities.
tax was enacted along with the health care legislation in 2010,
and the NAR remains hopeful that it will not go into effect.
As always, feel free to give me a
call 800-913-7677 with your real estate needs. I appreciate
Over 23 years in
Real Estate sales
Serving all of San Diego
yr fixed: 2.91%