There have been a lot of news reports of a potential 3-month extension of the $8,000 Homebuyer Tax Credit and those reports are all correct, albeit a little misleading. The bill they voted on would extend the deadline for closing a home sale as long as there was a signed contract by the original signing deadline of April 30th. So this doesn’t extend the tax credit itself, just the deadline for paperwork process. If you didn’t have a signed contract by April 30th, nothing has changed for you. If you did and the process has dragged on much longer than you planned, then you’ll get until April 30th (as long as the measure passes the Senate).

The House of Representative voted 409 to 5 to pass HR 5623 Homebuyer Assistance and Improvement Act of 2010. The measure will now go to the Senate for a vote and, assuming they approve it, will go to President Obama for signature. The Senate had included a similar provision in a much larger tax package that didn’t secure enough votes.

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As you read this, you might be wishing that you graduated just a year earlier and could take advantage of the $8000 first time homebuyuers credit. It’s not every day that Uncle Sam is willing to give you $8,000 for anything, let alone for something widely regarded as a fantastic investment.

But consider yourself lucky… buying a home within the first year or two of graduation can be a huge mistake for new graduates. My personal recommendation is that you don’t buy a home within five years of graduation.

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I’m a sucker for statistics, probably why I enjoy looking at numbers like the average retirement savings or the average tax refund, but I never gave the term “middle class” much thought until recently.

Fortunately for us, U.S. News & World Report has compiled some statistics on what the “average” is for a lot of money related statistics, like income, hours worked, etc.

Let’s take a look…
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A mortgage accelerator program is a fancy name for a program that promises to help you pay off your loan faster than you would making regular monthly payments. With the recession and with falling housing prices, advertisements for these types of programs are popping up everywhere. The real question, though, is whether they work and I have to go back to a tried and true adage – “If it sounds too good to be true, it probably is.”

These programs promise to help you pay off your loans in half the time. Half! They remind me of those ads where someone with $150,000 in IRS tax debt gets it renegotiated down to $50 (you know those ads right?) or how $10,000 in credit card debt was settled for $150 and a high five. They smell like scams but if we just left it at that, we wouldn’t really know the real answer right? (this is how debt settlement works, it’s not necessarily a scam but it’s very very dangerous)

So let’s find out what mortgage accelerator programs are and whether they’re scams.
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One of the unintended, though predictable, consequences of the unprecedented rescue of the United States financial system is that there will be higher than average inflation figures for years to come. While it’s been popular to dispute the reported Consumer Price Index (CPI), the reality is that the marketplace doesn’t really listen to the reported stats. It reacts to reality. Your boss doesn’t walk into your office and say “Oh, CPI says I need to give you an x% raise this year to maintain your purchasing power.” and the grocery store doesn’t increase the price of a head of cabbage a few cents every month because the BLS came out with another report.

So we need to be proactive and be aware that inflation is a real concern, before it becomes front page fodder for newspapers.
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The mortgage interest deduction is one of the most celebrated tax deductions in all of tax deduction-dom. It’s cited as one of the benefits of homeownership, right behind “you’re not throwing your money away,” and that fact is repeated over and over again. Unfortunately, I believe it’s misrepresented. It’s not as good as you think and I’ll explain why.

To claim the mortgage interest deduction, you have to itemize your deductions. For those who aren’t familiar with the idea of claiming itemized vs. standard deductions, you have two options when you file your return. You can either list all of your deductions, such as the mortgage interest deduction, or you can just claim the “standard,” which requires no proof.

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Whenever I or my wife tells people what I do (personal finance blogger), invariably one of the next few questions they ask is if I have any stocks picks for them. After I’ve explained that I don’t do that sort of thing, the next topic usually has to do with buying a house. After graduating college, the next “big thing” on peoples’ minds is usually buying a home.

My belief is that you shouldn’t buy a home within five years of graduating college or high school. First, a little about my home buying background. I bought a house four years after I graduated, after living in a few apartments, about six months before the height of the housing boom. I’m one of the fortunate few homeowners who have seen their home prices remain the same (no increase, no decrease – chalk it up as a win in my book!) but the reason I argue you shouldn’t buy a house within five years has to do with the non-financial reasons.

Don’t get me wrong, I love owning a home. I love owning our home. But don’t do it within five years.

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After last week’s Thursday post on adjusting your tax withholding, I thought that we needed a full blown post on the best year end tax moves. So who better to turn to than prolific tax expert Kay Bell, author of The Truth About Paying Fewer Taxes? She was kind enough to list not one, not two, but nine tax moves you can make before the ball drops.

It’s time to make your year-end tax list and check it twice to ensure that you give yourself the gift of tax-savings. Here are 9 ways this month to help make your 2009 tax bill as small as possible.

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