Clear Signs It’s Time to Replace Your Water Heater

27. May 2011 · Write a comment · Categories: General Tax · Tags: , , , , , ,

The first clear sign the replacement or repair of a water heater is on the horizon is when orange water is coming out of the water spout. A full flush and drain can be performed if it’s repair that you need instead of full replacement. But replacement may be your only option if you have not properly maintained it over time.

Until a person’s bathed in orange water and emerged from the tub feeling scummy, not clean, or until ruining a load of whites washing them in rust-colored water, chances are a homeowner may procrastinate when it comes to preventive water heater inspections. It’s easy to dismiss the bottom of a rusted one crashing through the floor as the hot water fills up the basement or streams through floorboards until it happens to you.

Before there were tankless water heaters, the traditional operated off of an anode rod. This aluminum or magnesium cast around a steel core wire with a hex head is usually 3/4ths inches in size in residential water heaters—the part may be small in size, but it’s contribution to the operating of heating your water is major. Whether it lives or dies largely relies on this rod. Called a sacrificial anode, it protects the tank from rusting over time.

Generally speaking, a six-year-warranty residential tank will have one anode rod, while a 12-year-warranty tank will have two. Commercial size tanks have from one to five. The anode rod works through using electrolysis, meaning when two metals are connected in water, the anode is consumed: one metal will corrode to protect the other.

A sacrificial anode’s life expectancy depends on the quality of the water, the amount of use the tank gets, the water temperature, and the quality of the tank. Water softeners add salt to the water which corrodes the anodes faster.

One of the dead giveaways that corrosion is present is rusty water underneath it.

Annual water heater inspections including draining and flushing can double its life expectancy. Hot water heaters last an average of 8 years. The attentiveness and a yearly investment of only 0 alone can lead to getting another 7-8 out of it.

Besides rusty water, the efficiency of a hot water heater can diminish over time, costing a homeowner more in energy costs than replacement. If the amount of hot water generated by a formerly well-performing hot water heater seems to be less by the day, it’s time to get a water heater check-up.

A professional plumber will examine the burner components of the water heater when performing a routine inspection. Remove the front cover of the hot water heater to get to clogged and rusty burners.

Today’s energy-smart consumers are replacing traditional water heaters with tankless water heaters that heat the water instantly upon demand vs. the traditional water heater keeps the water constantly heated and ready to be used. For a busy family or couple, that’s a lot of time spent waiting (while using costly energy).

According to Energystar, considering the energy savings (normally heating water accounts for about 15 percent of a house’s energy use) the cost of replacing your old water heater with a tankless one can be recovered in one year.gov) and the energy tax rebates now available. It’s enough of an incentive, says this master plumber, to inspire some homeowners to replace their water heater even though it’s not yet broken.

Obama’s Stimulus Package Offers First Time Home Buyers Huge Benefits!

26. May 2011 · Write a comment · Categories: General Tax · Tags: , , , , , , , , ,

If you’ve been following the news, you are likely familiar with the federal government’s 0-900 billion stimulus package designed to boost the economy by creating new jobs, providing mortgage assistance, educational grants, and a suite of other incentives.  A key part of this package is the first time home buyer stimulus program aimed at reviving the ailing housing market by assisting first time home buyers and buyers who haven’t purchased a home in the last three years.  The incentives for those qualifying under this program are such that even those previously opposed to buying a home in this market are now changing their minds.

The main reason the first time home buyer stimulus package is so attractive is that it directly addresses the concerns that most people have about buying a new home.  The first concern that most people have is how they will come up with the down payment.  After all, you must have a considerable sum of money saved away in order to come up with a ten percent down payment.  Thanks to the stimulus package, however, the federal government will help first time buyers by paying a percentage of the down payment.  In other words, you do not have to come up with the full amount on your own.  The second worry is the dreaded interest that accompanies monthly mortgage payments.  There is good news here as well as the federal government has cut interest rates.  Thirdly, those qualifying as first time home buyers can apply for refundable tax credit of ten percent of the purchase price of their homes (up to ,000) if they enter into a binding agreement by April 30th of next year.  This is practically money in your pocket which you do not have to pay back unless you decide to sell or move out of your home within the first three years.

With all these benefits, no wonder more and more people are getting exciting about buying a new home in these tough economic times.  These incentives will not last forever so if you have a steady source of income and are serious about owning your own home, now is the time to act.

Time to Get Ready for Winter

21. May 2011 · Write a comment · Categories: General Tax · Tags: , ,

In most parts of the country, winter does not wait for December to arrive. Now is the time to ready for the cold, snow and ice. You can start by winterizing your house. First check your storm windows and exterior doors for cracks, openings, etc. Seal any cracks and openings and caulk windows where needed.  Place weather-stripping around doors to keep the cold air out. Add extra insulation where needed. If you have an attic, adding insulation will not only lower your energy bill, it will help protect your roof from ice dams. There is currently a tax credit available on many of these energy saving items.

Have your furnace cleaned and change the furnace filters. It is recommended that you change your furnace filters monthly during the winter. Also make sure there no flammable materials near your furnace.  Installing a programmable thermostat will lower your heating costs. If you have a fireplace or wood stove, have it and the chimney inspected to make sure they are safe.

Also, clean your gutters and downspouts, and inspect your roof for any missing or worn shingles. Insulate any exposed pipes to prevent water in them from freezing and drain the garden hose. Service or tune-up your snow blower, make sure you have a good snow shovel, and a good supply of driveway salt. You should stock up on candles, flash lights, extra food, water, etc. in case the power goes out or you get snowed in for a day or two.

Next, winterize your car. Check the tires for wear or put snow tires on your car. Also check the tire pressure. Then, check the battery, belts, hoses, lights, heater, defroster, brakes, antifreeze, etc.  You should change the oil, replace the wiper blades and fill the washer fluid reservoir. You should also make sure you have a blanket, a first aid kit, tool kit, flares, cat litter, jumper cables, a snow brush, an ice scraper, a shovel, water and some food in your car. If you are not confident that your car will not get through the winter, now is a good time to consider replacing it with a more reliable one.

If you do decide to replace your car, there are many ways you can dispose of your present car.  If you donate car to charity, you will get a tax deduction of at least 0 and your car donation will help a very worthy cause.

First Time Home Buyer Credit – Qualifying Criteria and Restrictions

14. May 2011 · Write a comment · Categories: General Tax · Tags: , , , , , , ,

If you are looking to buy your first home in the near future, it is likely that you have heard about the first time home buyer stimulus program which offers you a tax credit of up to 10% on the purchase price of your home (up to 00) if you purchase by April 30th of next year. You are probably also familiar with the basic qualifying criteria like not having purchased a home as your “primary residence” in the three years prior to your current purchase and being within certain income limits. There are, however, certain lesser known restrictions and exceptions surrounding the regulations that could impact your eligibility. Failing to be aware of these provisions could result in an unpleasant experience with you being denied the credit or required to repay it. Conversely, if you meet certain conditions, the law may make certain exceptions that allow you to receive the credit even if you normally wouldn’t qualify.

Firstly, you must keep in mind that this program is designed to assist genuine first time home buyers who are purchasing a home as their primary residence. House flipping is not encouraged. The law requires that you maintain the home you buy as your primary residence for at least three years following your purchase. If at any point during that period your home ceases to be your primary residence (such as if you decide to sell it), then the credit must be repaid. Exceptions may apply to members of the armed services, intelligence community, and the Foreign Service who are under government orders for extended duty service. Next, you do not qualify for the credit if you bought the home from a close family member such as spouse, parent, grandparent, or child. You also cannot claim the credit if you are a minor or non resident alien. Residents living in the District of Columbia who have claimed the Washington D.C. first time home buyer credit also do not qualify. There is some good news for you, however, if you are a member of the armed services, Foreign Service, or intelligence community serving overseas. If this describes your current situation, then you have an additional year to purchase your home. This means that you have until April 30th, 2011 to enter into a binding agreement and until June 30th, 2011 to close on your purchase.

Although the basic qualification criteria surrounding the first time home buyer credit are relatively simple, the devil does indeed lie in the details. Make sure you avoid disappointments and missed opportunities by doing all your research and staying up to date on the latest developments.

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First Time Home Buyers, Good News

12. May 2011 · Write a comment · Categories: General Tax · Tags: , , , , ,

Mortgage rates pretty much held steady last week, which is good news for those wanting to refinance at a lower rate and for buyers, especially first time buyers. Freddie Macs Primary Mortgage Market Survey (PMMS) for a 30 fixed loan was a scant 4.86%, up slightly from last weeks 4.84%. Last year at this time, while the “bubble” was bursting, mortgage rates were 6.01%.

Real estate professionals from around the country are reporting increasing sales, not by a lot, but increasing. Still, there is quite a bit of inventory out there on the books yet, meaning supply is still out in front of demand.

Another thorn, the major banks have been impediments standing in the way of short sales. Banks get less money in a short sale situation. Some banks, including Bank of America, have reportedly been taking a more rational stance lately on short sales to avoid the costly foreclosure process. So banks with a lot of inventory and eminent foreclosures will be able to get more homes off the market. They may take less money, but some is better than none and it lessons inventory which will eventually drive prices up.

Higher home prices will definitely be part of the near future. Good news for sellers and builders. Bad news for buyers. The time to buy is now. There’s a good chance we’re in the trough of this latest business cycle and about to start the recovery phase. When that happens home prices will rise and interest rates will soon follow to try and head off inflation.

Some really good news coming out has to do with the Governments 00 tax credit for
qualified first time home buyers. Right now the FHA is finalizing a plan that would allow for the tax credit to be used up front as a down payment. If, and when, this program goes through, it will be a big win for the market.

After the sub prime loan debacle of the last several years where anyone could get a loan and buy a house with no money down, no credit and in some cases no income, the banks have become much more strict in their lending practices. It’s been difficult for this administration to get any momentum behind it’s efforts to end the housing crisis. This new FHA program just makes sense. By giving the credit up front, it will greatly improve peoples ability to acquire financing with the required 3.5% down. There will still be income and credit qualifications so we don’t end up in another mess like the one we’re pulling out of, but it will help to get the ball rolling and get these houses off the market and lived in.

So again, the time to buy is now. The time to sell will be in the near future. Somewhere along that line the market will hit equilibrium, where it is the most beneficial for both buyer and seller, but for the most part one benefits more than the other. Right now it’s the buyers turn. Right now it’s a buyers market.

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