Affordable Care Act

I have had several people ask lately about the Affordable Care Act that is part of the new health care bill that goes into effect January 1, 2013.  The question is: Does the new law impose a 3.8 percent tax on profits from the sale of my home?

The answer is, no, with just a few exceptions. The new 3.8% tax will apply to the “unearned” income of “High Income” taxpayers. “Unearned” income is earnings from capital investments, such as capital gains, rental income, dividends and interest income.  The taxable portion of the unearned income that is subject to both income and the new Medicare tax is the amount of income gained from these sources, minus expenses associated with earning that income.  "High income" is considered as those with individual incomes over $200,000, or $250,000 for couples that file their taxes jointly. 

The sale must net a PROFIT of $250,000 in the sale of your PERSONAL residence, or the first $500,000 for married couples, in order to incur 3.8 percent tax.  Again, only those with Adjusted Gross Incomes (AGI) over $200,000 per year (or $250,000 for couples filing jointly) will be subject to the tax.   With these high figures, very few people will be affected. But don’t think that those with incomes over $200,000 ($250,000) are automatically taxed:  It still won’t apply unless the PROFITS from the sale of the PRIMARY RESIDENCE are $250,000 or more ($500,000 for married couples).  According to the Internal Revenue Service, in order to qualify for the $250,000 ($500,000) exclusion, you must be the owner of the home, and have lived in it as your primary residence for at least two years out of five years prior to the sale of the property. This exclusion does NOT apply to vacation homes or rental properties.  Using the September 2012 national median sales price of $183,900, as reported by the National Association of Realtors, you can see the vast majority of homeowners will not be affected, since the sale of a $183,900 home could not possibly generate a $250,000 profit.

If you have questions, or would like to discuss the sale of your property, I would be happy to help.  Please give me a call at 478-973-2684 or send me an email at: jpugh@goldenkeyrealty.net. 

Slow and Steady Wins.......

Housing prices have gone up for the fifth month in a row.....Hoping to see trend this continue!

http://money.cnn.com/2012/10/30/real_estate/case-shiller-home-prices/index.html

I'm a Leader. Unless It's Dark. Then You Go First!

Halloween brings out the creepies, ghosts, and goblins!  Haunted houses have us paying to be scared senseless. But as I was driving to a listing appointment yesterday, I had to laugh about a memory of a creepy house that a client wanted to see, years ago, before I moved to Georgia.

As a brand newly licensed Realtor® in the State of Tennessee, I was eager to please my clients, willing to go the extra mile in order to find them a perfect, new home.  Little did I know, the “extra mile” was going to take me on a 10-county house-hunting expedition!

While I was an agent in Tennessee, my keypad gave me access to every lock box in the state---I had no limits to where I could sell properties, as long as I was willing to make the drive.  I lived in Knoxville, but if someone wanted to see a property in Memphis, I could show it to them.  Now, of course, I wouln't go to that extreme-I would simply refer a client to a Memphis agent.  But you get the idea.  The advantage was that if we had clients that wanted to see properties in outlying counties, it wasn’t a problem.

I was working with my second client as a Realtor®, and I was ready to impress them with my knowledge of the area and newly-learned skills I had gotten in the classroom.  I was ready to give them a tour of Knoxville, but they wanted to see properties in remote locations, as well.  They weren’t particular about what county they lived; they just wanted it to be rural, with privacy and acreage.  They were fine with a house that needed some repairs:  They were cash buyers, so my search required no limits as to whether the house was a fixer-upper or not.  I went to work searching for properties in their price-range, with the minimum required acreage and house that was suitable for the needs of their family.  In order to have several properties for them to consider, they asked me not to limit the search by county.  The search ended up with properties expanding across 10-counties:  Knox, Blount, Anderson, Morgan, Sevier, Roane, Grainger, Union, Loudon and Jefferson counties. 

Now, in the life of a real estate professional, you never know what each new day will bring, which is one of the things most appealing about being in the business.  It is also one of the things that causes the most anxiety….but can make for some great stories!  So, here goes:

We traveled through Knox County. We searched high and low in Loudon County, and a few places in Blount County with elevations that made our ears pop. We drove up hills in Sevier County that made my brakes rebel and smoke on the way back down.  In spite of the miles racking up on the odometer, I was still good with it.  I was driving a Ford Expedition that was going through gas like water, but I was bound and determined to make sure my clients were well taken care of.  (I even had a cooler of bottled water and a basket of snacks in the back seat in case anyone needed refreshment!)

The day was coming to an end, and they wanted to see one more…..The one they thought for sure was,  “The One.”  It was located in an unincorporated town in Morgan County called, Petros.  (Pronounced Pee-Tross.)  Petros, at one time, was a coal mining town, and the home of Brushy Mountain State Penitentiary (which closed in 2009).  The movie, October Sky, filmed several coal mine and town scenes in Petros. 

To give you a little history and to set the stage for the showing that night…..Brushy Mountain State Penitentiary is an old prison that opened in 1896.  The original prison was a wooden structure, but was later replaced in the 1920s with a castle-like building constructed from stone mined by prisoners from a rock quarry on the property.  As of 2008 Brushy Mountain was the oldest operating prison in Tennessee.

The prison is almost completely surrounded by rugged wooded terrain in a remote section of the Cumberland Plateau. Escape attempts were infrequent and almost always unsuccessful. The best-known escape attempt occurred on June 10, 1977, when James Earl Ray, the assassin of Martin Luther King Jr., escaped by climbing over a fence, along with six other inmates.  Ray was captured less than two days later in a rugged mountain terrain less than three miles from the prison.

In its final years of operation, Brushy Mountain had a capacity of 584 inmates, of all custody levels.  It kept a maximum security designation due to the ninety six bed maximum security annex within the prison walls. These ninety six beds were used to house the states most troublesome inmates.

So this is where the house was that my clients wanted to see:  In Petros, TN. They were ready to buy, and I was ready to write an offer!  So setting aside all sense fear and anxiety and putting on a confident face, we headed up to Morgan County to find that the house had no electricity turned on, and the sun was well on its way down behind the hills.  We were soon to be in the dark…..In Morgan County…..Where James Earl Ray had escaped from the pen back in the day.  No problem. I can do this. These being my earlier, less experienced days, I didn’t have a “tool kit” put together that held all the tools of the trade I now keep in my car, such as a flashlight.  But since it was dusk, we could still see a bit from the outside.  The INSIDE of the house was another story.  For some reason, all the windows in the house were covered with wrapping paper, so no light was able to come through the windows.  The walls were paneled throughout the house, adding to the darkness of the building.  We pretty much had to feel our way through the house as our eyes adjusted to the lack of light.  I kept telling myself, “It’s fine…What are you expecting to find?  A dead body? Perhaps an escaped convict?”  Come on!  I can DO this!  We headed to the back of the house to check out the last bedroom at the end of the hall.  Ready to point out the closet features of the home, I opened the closet door and had to jump out of the way of SOMETHING falling out of the attic space in the top of the closet!  I turned around and bolted out of the house, most likely screaming some absurd, high-pitched squeal that did nothing to add to the professional image I was trying so hard to maintain! 

Back in the car, heart pounding, and sure a dead body had just fallen through the ceiling, I realized I had left my clients in the house.  Catching my breath and trying to get my heart rate back to a comfortable pace, I looked up to see that they were on the way out of the house and headed toward the car.  They got in the car with a chuckle (and I am sure a big eye-roll), and stated, “Now THAT was one deadly foam mattress pad!”

I didn’t get nominated for Realtor of the Year that year.

But, I did sell them a house.  Just not in Petros.

Tomorrow is Halloween, so here are some tips to keep the kiddos safe! Have a Happy Halloween!

ON THE TRICK-OR-TREAT TRAIL: 
•A parent or responsible adult should always accompany young children on their neighborhood rounds. 
•If your older children are going alone, plan and review the route that is acceptable to you. Agree on a specific time when they should return home.

•Only go to homes with a porch light on and never enter a home or car for a treat. 

Because pedestrian injuries are the most common injuries to children on Halloween, remind Trick-or Treaters:
•Stay in a group and communicate where they will be going.
•Carry a cell phone for quick communication.
•Remain on well-lit streets and always use the sidewalk.
•If no sidewalk is available, walk at the far edge of the roadway facing traffic.
•Never cut across yards or use alleys.
•Only cross the street as a group in established crosswalks (as recognized by local custom). Never cross between parked cars or out driveways.
•Don't assume the right of way. Motorists may have trouble seeing Trick-or-Treaters. Just because one car stops, doesn't mean others will!
•Law enforcement authorities should be notified immediately of any suspicious or unlawful activity.

© 10/09 American Academy of Pediatrics

Moving In and Out of Season

October is one of my favorite times of the year.  Not only are the temperatures more comfortable, but the evolution of the seasons from autumn to winter has special characteristics that I always look forward to.  The changing of the leaves always makes me feel re-charged in one sense, and relaxed and content in another.  Along with the better weather, there are so many activities and events going on during the fall, and we are never at a loss for things to do. 

This past weekend, I traveled with my family and a couple friends to stay the weekend in the Smoky Mountains.  Being a native of East Tennessee, those Great Smoky Mountains were pretty much in my backyard as a child.  I moved to upstate (Ithaca) New York when I was 12 years old, where I also experienced tremendously beautiful scenery.  Quite remarkably, the area I lived was very similar to East Tennessee with its gorges, waterfalls,, lakes and mountains.  Fall in upstate New York is breathtaking, and a wonderful place to live!  I remember the magnificent Ithaca sunsets on Cayuga Lake that are the subject of songs and photos, and backdrop to many special events. 

This past weekend in Tennessee, the leaves were peaking, and the color was breathtaking! We took the scenic route back to Georgia this time so we a better view than just interstate.  I am so glad we chose to take the long way home because there was so much to see!  Along with the usual wildlife, we saw a herd of elk in a field---not something I have ever seen before.  We drove past some places from my childhood and early college years that were especially meaningful to me and my family, for one reason or another. A lot of history and heritage for my family in those mountains, and I am blessed to have such warm memories.  I came home in an especially peaceful state of mind.  

Back in the 80's, when it came time to go to college, I headed back to the hills of Tennessee to attend the University of Tennessee in Knoxville.  After graduating, I lived there for nearly 23 years prior to moving to Georgia 7 years ago.   I love having friends and family in many parts of the country!

Moving can be stressful, or it can be an exciting adventure.  I have always tried to keep a positive perspective on relocation, and the opportunity to make new friends and experience new things.  Whenever I have moved to a new area, I have worked quickly to learn as much as I can about my new home.  Having an incurable curiosity, this works to the advantage of my clients, as I can be a  community resource of information.  I love to introduce and welcome our new neighbors to this area.  I am sympathetic to the challenges of getting established in an unfamiliar place, and work hard to help my clients overcome any hurdles that may come up.

Starting out completely unfamiliar with my new middle Georgia home, I had a lot to learn!  After lots of research and loaded with lots of great information, I decided to create a Facebook page to share.   If you want to find out what's going on in and around Houston County, Georgia on a daily basis, be sure to check it out:  https://www.facebook.com/365ThingsToDoInWarnerRobinsGa.  For more home tips, ideas and real estate, check out my other page at https://www.facebook.com/JaniePughofGoldenKeyRealty.  And of course if you, or someone you  know, have any real estate needs, please give me a call! 

Fall is in the Air!

Fall is in the air!  I don't know about you, but I am loving these cooler temps!  What a relief from the 100 degree Georgia summers we have!

Here is a fun fall recipe that is fun to take to parties, potlucks and get togethers.  Fellow Golden Key Realty colleague an awesome cook, Caren Bridges, was kind enough to share this recipe with me several years ago, and I have made it many times since!

Apple Cheese Ball

Mix together 10 oz. shredded white cheddar cheese, 1 t. garlic powder, 1/2 t. salt and 1/4 t. ground cayenne pepper. Stir in 1/2 cup chopped apple and 8 oz. softened cream cheese. Chill 30 minutes. Shape into a tight ball. Put 1/2 cup paprika in a zip-lock bag and add cheese ball, tossing gently to coat completely with paprika. Put it on a serving plate and add a stick of cinnamon for the stem and a bay leaf or two for leaves.

Back to Basics

I have to admit, I have a secret, guilty pleasure.....The Real Housewives of New Jersey.  But don't judge me.  Where else can I spend an hour a week, realizing how utterly, absolutely, and quite simply,  NORMAL, I am?  Well, ok.  I can watch Judge Judy and REALLY feel normal…and exceptionally intelligent.  But in the world of so-called “real housewives”, amidst all the money, cars, mansions, diamonds and fame, the only thing those “real” housewives seem to be is real UNHAPPY!  They make it obvious money doesn't buy happiness.  The drama of their lives portrayed every week on reality tv makes me realize how satisfying my simple life is.

Recently, I went to a financial planning presentation with my husband, and came away with a couple of  pearls.  Not in the literal sense----some pearls of wisdom.  What are your grandparents doing in their retirement (or what DID they do?)  Did they retire at the age of 65?  Did they have enough money to live comfortably?  We listened to the discussion, with most sadly reporting that their grandparents weren't able to retire because that they never had enough money to cover their expenses.  Many people in the room shared similar stories.  My husband and I realized we are blessed.  Our grandparents had set some really fine examples for their grandchildren:  Don't spend everything you make.  But did we listen?  Not a chance.  We did more than just the opposite.  We didn't just spend everything we made----we spent MORE!!!!   After all, that is the American way, isn’t it?   Fortunately, realizing the error of our ways after the help of some really educational workshops and classes, we are back on track.  (Thanks, Dave Ramsey and Financial Peace University!)

The bottom line is, we need to get back to the basics.  When we are struggling to figure out why things aren’t working out the way they should, we should resolve to get back to the basics.  Why don’t we just stay there since that is what works?  Why do we find it so necessary to change what is working?

Since it is football season, let’s take a look at the game. The BASICS of the game.  Football, or baseball, both of which are big in my family, provide some great lessons. The rules of the game have been the same since the first ball was thrown.  The results are predictable:  You show up for practices, you focus, you play as a team, you work hard, you play hard, and you might win the game.   Although the effort is not easy, the concept certainly is.  No perks without the works.  You work hard, you play hard, you win, you are rewarded and you get to celebrate. Are amazing athletes just born amazing?  Did he/she just show up for the game and play like a pro?  Of course not!  You have to crawl before you can walk, practice before you play to win, start where you are and go from there.  In real estate terms, your first home is going to be a starting point for eventually moving up to the big “dream home” you are creating on a "pin-board"!  Realistic expectations are critical to know the difference between a good real estate opportunity and avoiding biting off more house than you can chew.  First-time home buyers, especially, need to understand this.

On a visit back to my hometown one weekend for a football game,  I stayed at my parent’s house.  I was sitting at my mom’s vanity in the bathroom putting on my makeup, and saw a tray of colognes and after shave that belonged to her and dad.  Although my dad has traveled all over the world during his career, picking up exotic perfumes as gifts for mom, and awesome colognes for himself, none of them took me back to a favorite memory from the past than one small bottle with the little red ship.  The scent took me back to when I was a four-year old, and dad and I would pile into the old, green “woody wagon” after breakfast.  (And breakfast, by the way, was always hot and on the table at the same time every morning.  Lucky me!)  He would drop me off at nursery school on his way to the office...And he always wore that scent with the little red ship on the bottle.  Expensive?  Nope.  Memorable?  Absolutely!  Every time I smell that scent, it takes me back to the 1960's in Columbia, MO.  So is there a big, expensive price tag that makes the best memories?  Is it the house they now live in and have worked for their entire lives what makes my most cherished memories?  Of course not-it is the journey and the memories we made over the years to get to where they are now that are most important.  My parents raising four kids, getting us to after-school events, practices and activities (and attending every game, recital or competition), sending all of us to college with mom staying home to coordinate and make sure it all happened as it should:  Was it easy?  Heck, no!  I know how much time, effort, money and energy it takes to get that all done, now that I am an adult and have done much of the same for my three kids.  I know they made their MORE than fair share of sacrifices.  But those memories are the foundation for which I build my own adult life.  Those memories make me the wife, mother, friend, and professional that I am.  It is the most simple things that have taught me the best, most important lessons and that take me back and make me smile.

So when I watch the “Real Housewives”, and I laugh and smile, it is not because of the quality or content of the show.  It is more of a "smug" smile, because I am content and happy with all that I have and know, and that I am rich beyond belief with amazing memories, family, friends, clients and colleagues that add value to my life every day.