Well it's time again for our annual New Year's Resolutions here at Southern Nevada School of Real Estate.

Don (our beloved, but behind the scenes webmaster) - Resolves to not treat all of us computer neophytes at SNSORE with disdain or as if we were morons (despite the reality of our situation).

Mary - Resolves to continue her supervision over the rest of us in her ongoing quest for sainthood. (For putting up with the rest of us, she should be a shoe-in.)

Cherie - Resolves to work on her pilau mouth in making comments about some of the incoming telephone calls.

Duane - Resolves to bring with him to change into, and stop wearing in class, his honky-tonk duds on Thursday and Friday nights for after class two-steppin' at Sam's Town. He further resolves not to offer himself up for target practice in any future car-jackings.

Valerie - Resolves to stop attending Chippendales and Thunder Down Under shows until 3:00 am on school nights.

Andy - Resolves to stop attending shows at Olympic Gardens, Cheetah's, Little Darlings, Spearmint Rhino until 5:00 am on any and every night. He will be home by 3:00 am (and pick up Valerie on the way home).

Gordon (a/k/a the Swami 22-36, this football season) - Resolves to actually know which teams are playing each other before making any picks.

Randy - Resolves to continue reliving the first childhood he never had through his daughters Lauren and Logan. He further resolves not to question their judgment in any way since it is clear that both of them are infinitely smarter than Daddy despite being 3 years old and 18 months. (Lauren said to me last week, "Actually Daddy, you are mistaken!" - She was right, I was.)

Jennifer - There simply is not enough room here to recite all of Jennifer's necessary resolutions.

Happy New Year!

-- Randy van Reken

Coming in 2001. . .

For several years, Randy has been sending a Tax Tip of the Day during tax season (February 1 to April 15) to various email discussion groups. This year he is going to offer this to anyone. Each tip has some relationship to real estate, business, home ownership, self-employment or some other relevance for you or your clients.

All you have to do to subscribe is send Randy an email asking to be included for these Tax Tips of the Day. Send it to rvanreken@earthlink.net and just mention Tax Tips somewhere in the subject line or body of the email. If you subscribed last year, you are already on the list and do not need to re-subscribe unless you have an email address change.

These will also be posted periodically on Randy's tax web site www.thetaxmaninc.com.

Subscribe at:

FHA Mortgage Insurance Change

Mortgagee Letter 00-38 dated 10-27-200 announces:

Effective for all loans closed on or after 1-1-2001:

- A reduction in the Up Front Mortgage Insurance Premium to 1.50% (current rate is 2.25%);

- A shortened Up Front Mortgage Insurance Refund Schedule (From 7 to 5 years);

- Cancellation of the annual mortgage insurance premium after the loan amount is reduced to 78% or less of the property value (based on the lower of the sales price or appraised value at origination).

These changes apply to single family units and town homes. Condominiums remain unchanged.

Cancelling FHA's Annual Mortgage Insurance Premium (Monthly MMI)

Effective for all loans closed on or after 1-1-2001:

FHA annual mortgage insurance premiums (MIP) will be automatically canceled under these conditions:

• -New mortgages with terms more than 15 years: the annual MIP will be canceled when the loan to value ratio reaches 78% of the original price, if this mortgagor has paid the annual MIP for at least five years.

• -New mortgages with terms 15 years or less and loan to value ratios 90% and above: the annual MIP will be canceled when loan to value ratio reaches 78%, regardless of how long the mortgagor has been paying the MIP.

• -New mortgages with terms 15 years or less and loan to value ratios of 89.99% or less: will not be charged annual MIP at all. (Only the up front fee is charged).

All of these new rules only apply to new FHA loans closed on or after 1-1-2001.

Residential Rehab Class

We are working with Tony Brueneman of the Home Inspection Institute to offer a Residential Rehab Class over two days in the spring of 2001. Dates have not been set yet, but it will involve these issues:

- Rehab strategies

- Rehab pitfalls

- Finding high-profit and low risk properties

- Neighborhood analysis

- Reviewing the most profitable repairs

(and the least profitable repairs)

- Inspection - Appraisal - Financing

Everybody and their brother thinks they can make millions in real estate rehabs (or day trading in stocks). And like day-traders in the stock market, most don't make anything. This will help you gather and analyze important information before making an expensive mistake.

To be notified of the dates email me at:

rvanreken@earthlink.net.

-- Randy van Reken

This past year I received many phone calls from students worried because their spouse had someone prepare, or worse prepared their joint income tax return. They had no real idea what was on it, and when they asked about things, their spouse said "just sign it!" Deep down there was this sinking feeling that they were getting themselves in trouble. And unfortunately that is often the case. As I have written in prior articles, even though a tax preparer prepares the return, you are the one(s) the IRS will personally go after both civilly and criminally if they find errors or fraud on the return. Remember you sign your name above your preparer! And there is also that part about, "Under penalties of perjury . . ." (You should take that seriously. After all you aren't the President - perjury counts.)

In order for you to protect yourself in this situation, there is an alternative. You can file married filing separately. But I would only suggest using this filing status if you feel very uneasy in the way your spouse is filing your tax return. This is usually your last alternative. Married filing separate is the worst way to file in most cases as well as very complicated. Your separate tax liabilities (for both you) combined are often significantly higher than married filing jointly. But this is the price you pay for peace of mind. My wife won't file with me.

But in case you have already filed jointly, and now a problem does arise on the tax return, under certain circumstances you might have an "innocent spouse" defense. What this means is that you are telling IRS that you knew or should have known that the tax return you filed was inaccurate, but your spouse forced, threatened, or in some way coerced you to sign it. In most cases, if this is true the IRS will grant you innocent spouse relief, and relieve you of responsibility for items on the return that affect your spouse only (HIS Schedule C business, HIS stock transactions, etc.). I go over the ways you can request relief as an innocent spouse in my class, Managing Your Business.

Another area of concern this year will be the matching of names and social security numbers on the tax returns. IRS has for years been verifying with the Social Security Administration (SSA) the social security numbers on tax returns. If the number and name do not match, IRS will deny an exemption or credit for child. This also affects those women who got married or divorced during the year, and did not notify SSA of the name change. It also sometimes affects children adopted during the year.

More on these issues plus many after year-end tax tips in my Managing Your Business class. It will be January 19, 2001 from 1-4 pm.. See you in class!

-- Andy Russo

Managing Your Business

Your Income Taxes

Friday, January 19, 2001

1:00 pm - 4:00 pm

Andrew C. Russo, Jr., E.A.

3441 West Sahara - Suite A7

Las Vegas, Nevada 89102

702-656-1052 - taxdr@skylink.net