Tuesday, January 19, 2010

Am I weird, or what?

Pathways Advisory Group, Inc.
David L. Williamson, CFP®

I discovered online chess in November. I’ve played chess off and on through the years, mostly in college (usually in lieu of studying!). It’s a great mental exercise full of calculations both strategic and tactical. I enjoy it. I’ve played a lot online these past few months - with opponents all over the world. But it seems our leisure activities can strangely affect us.

I find my movements are now sometimes chesslike. (At least I think about chess as I move.) The rook moves straight ahead or straight back - think north or south. Or he turns exactly right or left and then marches directly east or west. Not much creativity there. Much of my daily movement seems predetermined this way. This, my wife tells me, is my absentminded mode. She sees a lot of that.

The bishop slides all over the compass on diagonals. Northeast, southwest, etc. Tricky movement. I use this move when sneaking up on the dog. Or when I try to pass the buck at work. (Although I prefer to call this delegation.) My wife sees the bishop in me when I attempt to slide out of doing the dishes.

The queen is all powerful. She can move just like a rook or, when circumstances warrant, slide around like a bishop. I try these power moves, but my wife seems far more adept - shifting effortlessly between blunt force and sly, fluid outflanking. I never quite know where she’s going next.

The pawn is the little dude who usually marches forward one step at a time. On my early morning walk, I’m like the pawn. One foot in front of the other. When the pawn begins his march from the 2nd rank on the board or I from the back door, we sometimes bound forward with extra vigor. The pawn is allowed this optional extra long stride only as his first move.

Then, strangest of all, is the knight - the horse like figure. The knight jumps one step in any direction, then leaps two steps more but at right angles to the first step. Picture the capital L. Or like this ­­­Γ. An extremely sneaky way to move. I use this move when I’m cornered. Or when I’m indecisive. Should I do this first or that? Almost like you forget where you are going. (Why am I looking inside the fridge? I meant to open the microwave!)

Chess affects my thinking, too. I sometimes plot just one move ahead, or two, or, on a good day, three. I sometimes face a problem or obstacle head-on, like a rook. Or, when dealing with wives, or co-workers, or grandchildren, or clients, or even myself, I’ve got to be the devious bishop. Weirdest of all is the knight. I sometimes do the crazy knight two-step until I’m back where I started! But, best of all, is to use chesslike thinking to solve a problem. First, find a good move. Then, be patient, be observant, be diligent, and find a better one.

Oh well. I guess weird is OK. By the way, you can see me in action (albeit extremely slow action) on chess.com. I go by chippook. If you play, look me up. Let’s have a game. Oops! I forgot to mention the king. The king may move one step, but only one, in any direction. His eternal problem is “Whither do I go now?” Sounds like he needs a good planner!!

Thursday, January 14, 2010

First Time Home Buyer Tax Credit: Part 2

Estate Tax reform remains on the agenda. Health care reform and Financial Regulatory reform, as well. What will happen? When will it happen? We don’t know. We can, however, offer one update. The Worker, Homeowner, Business Assistance (WHBA) Act of 2009 was passed on November 6th 2009. A primary purpose of the act was to extend and expand the First Time Home Buyer Tax Credit originally described in last September’s blog post. If you are in the market for a new home - it may be worth your while to accelerate your search.

The WHBA Act extends the First Time Home Buyer Tax Credit to include eligible purchases prior to May 1st 2010. The act also includes some interesting expansions. The act broadens eligibility to higher income levels and includes a reduced credit for certain “long-time residents” purchasing a new home. Here are the rules:

  1. The deadline has been extended to May 1st 2010 - a binding contract must be signed by May 1st. The credit can be used to purchase a new or an existing home - but must be your principal residence.
  2. The Adjusted Gross Income (AGI) phase-out range for eligibility has increased: $125,000 to $145,000 for Single taxpayers and $225,000 to $245,000 for Married Joint taxpayers.
  3. The $8,000 tax credit is claimed on your 2010 tax return. It can, however, be claimed on your 2009 tax return to accelerate the benefit or to ensure AGI qualification.
  4. It remains refundable. If your total tax for the year is zero, you will receive the $8,000 by check. The home must remain your principal residence for three years.
  5. The definition of a first time home buyer continues to be someone who has not owned a principal residence for the past three years.
  6. The Act offers an alternate credit of $6,500 for previously ineligible taxpayers who have: owned and used a house as principal residence for any consecutive five-year period during the eight-year period ending on the closing date for the purchase of the new residence.

Your Realtor should have up to date information. The National Association of Realtors posts a summary on their website .

Please check with your accountant to verify all specifics.