Home Equity Assistance & "Military Families Pushed to Financial Ruin" (Merge)

[armyvern]

Just to put a spin on things here. Say my husband did go on IR to Edmonton for 3 years. They are paying to put members up in private accommodations with rent as high as 1800/mth plus Separation expense and low rate dinner allowance. Soldiers were put out of the shacks because accommodations were so limited. Over a three year period the costs would be around $80,000, less than the loss I am taking on my house.

BINGO, but it would not have been your loss would it?

Try finding a civvy employer anywhere who would do such a thing for their employee who had to move!! You won't; they get the old "move or you're fired. period."

Damn, we doooooo have it good here in the CF with the options we get.

 

[Occam]

You forgot that Joe civvy also has a choice when his employers tell him they are relocating him ... "Relcoate or be out of a job, and, do so without us paying a single thing for you. No real estate fees, nada".

Those situations where civvies are forced to relocate with no other option are few and far between, and when they do occur, they are able to claim those moving expenses against their income tax.  That includes:  transportation and storage costs, travelling and meal expenses, temporary meal and lodging expenses at both ends of the move, legal fees, deed transfer fees, real estate commission and any mortgage-breaking penalties.  If I were in the position of choosing between taking a huge loss on the sale of my home in order to keep my current position, and having to look for another civilian job, I know which one I'd choose.

As for my relationship status - as if THAT has anything to do with the above - I'm on my second. The 1st marriages failure also had sweet frig all to do with any IR posting. Had I stayed in that marriage another 11 months, we'd have experienced our 19th anniversary. is that a good enough answer for you??

My question on which marriage/relationship you are on now was rhetorical...I'll take your word at face value that your failed marriage was not caused by frequent moves, IR and the associated strain on the marriage, but there are a lot of failed marriages out there which were caused by those conditions.  See SCONDVA if you don't believe me.

By the way, I've got 22 years in and am on my 10th posting. 10 pack up and move postings. Using IR as a method to haelp my family avoid moving all together?? You obviously do not know my family very well.  :  3 IRs out of 10 postings STILL leaves my family moving seven times in the last 22 years ... I guess that indeed makes it the "temporary fix" that it was supposed to be eh??  :

Congratulations.  I have a fair bit more time in than you, and have one cost move to my name.  That doesn't negate the fact that IR was not designed to be anything more than a year or two stopgap measure to allow kids to finish school without a move interrupting their final year, or other temporary conditions.  It certainly was NOT meant to allow a family to stay in place for the duration of an entire posting to prevent the member from having to sell during a lull in the housing market.  I'd love to see how much IR is costing DND these days.

The sense of "entitlement" amongst some these days is atrocious. My question on giving back the "profits" of home sales was rhetorical ... I knew damn well that people would NOT be good to go with that. Quelle surprise ... NOT.

This has nothing to do with a sense of entitlement.  If the forced move of a CF member causes them to be at a financial disadvantage, then there should be a reliable mechanism in place to compensate them for reasonable expenses related to the loss. 

As for the "giving back the profits of home sales" point, it wasn't rhetorical, it was downright ridiculous, and had no place being brought up.

 

[George Wallace]

Those situations where civvies are forced to relocate with no other option are few and far between, and when they do occur, they are able to claim those moving expenses against their income tax.  That includes:  transportation and storage costs, travelling and meal expenses, temporary meal and lodging expenses at both ends of the move, legal fees, deed transfer fees, real estate commission and any mortgage-breaking penalties.  If I were in the position of choosing between taking a huge loss on the sale of my home in order to keep my current position, and having to look for another civilian job, I know which one I'd choose.

Glad you brought this up.  A house is an investment.  What are the rules; specifically are there any that would prevent a member, such as in this case, from claiming this loss in their Income Tax Return?

 

[Occam]

Glad you brought this up.  A house is an investment.  What are the rules; specifically are there any that would prevent a member, such as in this case, from claiming this loss in their Income Tax Return?

According to CRA, a loss on the sale of a home cannot be claimed under moving expenses.

 

[heavy reader]

As for income tax, the loss on a home sale cannot be claimed as a capital loss.  The only exception is if part of your home is used for a business. 

Further, half of any Home Equity Assistance above $15 is considered a taxable benefit.  I.e. If you had a 90K loss, $37,500 would be considered pers income and you would be taxed for it accordingly. 

Even if approved for 100% HEA from Core, the tax man will come a callin'.  This is due to the Canada Revenue Agency regulations.  Therefore, even if you "win" you loose.

 

[PMedMoe]

That doesn't negate the fact that IR was not designed to be anything more than a year or two stopgap measure to allow kids to finish school without a move interrupting their final year, or other temporary conditions.

You forgot married service couples.  Not a heck of a lot of choice there, except for one to release and lose a pension they've paying into for quite some time, not to mention severance pay, etc.

It certainly was NOT meant to allow a family to stay in place for the duration of an entire posting to prevent the member from having to sell during a lull in the housing market.  I'd love to see how much IR is costing DND these days.

Are you in Ottawa?  I bet they have the highest rate of IR in the country.  People have been there for years on IR, simply because their spouse doesn't want to move.  IMHO, the IR is being abused at that point.

 

[REDinstaller]

I'm sure that Cartier Suites would hate to see IRs in Ottawa end. What a loss of income that would be.

 

[George Wallace]

According to CRA, a loss on the sale of a home cannot be claimed under moving expenses.

I wasn't thinking along the lines of "moving expenses".  It may have been a result of having to move, indirectly, but it would have been a loss on an investment.  The Government would have been after you for "Capital Gains" if you made too large a profit on the sale, but what about a loss?

I think this has been answered in the posts fol yours.

How can you tell I am not an Accountant?  ;D

 

[REDinstaller]

And any reimbursment is subject to taxes. My WO got posted out of Winsor in 08, and got his HEA, then found out it was a taxable benefit.

 

[Maritimegal]

Let's move away from the whole the CF forces us to move debate and back to the topic. There is a policy, like it or not, that we all have to follow.

The 100% HEA was meant to be used in exceptional circumstances, hence the reason the need to provide a 3 inch binder worth of information. I think terming the HEA as a lotto was incorrect, however, it may have been seen as a crutch or rescue net for some who moved. Maybe it wasn't explained the best it could have been. With 20-20 hindsight, some people may have made a different choice.

I think many of us take home ownership as a right. We have often been insulated from the real costs and turmoil of the real estate market because DND does a rather good job of reimbursing us for all the moving we do. However, based on our salaries, should many of us be purchasing homes 5-7 times our annual salary with a minimum down payment and a 35-40 year mortgage?

To the posters who say they couldn't find a nice house under 300k when they moved, this should have been the first clue that sinking all ones savings into a single asset was a bad idea. Even renting a place for the equivalent of a mortgage would save some the huge losses they are going to take if they can sell their homes.

In Heavy Readers post, he indicated he proved the "community" not Edmonton he bought in is depressed by 20% since he purchased his residence. The policy does not read: Situation void if home bought when prices were inflated. By the time I sell my home, I will lose roughly the same amount and I did not buy a home 5-7 times our annual salary. There are factors in my specific community outside Edmonton that have further contributed to the market decline.  DCBA has been rejecting claims on the basis that no markets in Canada are depressed. I wonder if they are just grouping all CF members in with the city of Edmonton market which is quite different than the real estate market in small communities outside the city (but are part of the geographical area).

If cases are truly examined on an individual basis, and you prove and provide the requirements listed, I don't see any reason for the case being declined. I am sure the CF is well aware of this issue, but realizes if they pay one person, there will be many more cases to follow.

I've got to comment on the yellow bits. The  military did NOT create the housing market. They should have kept soldiers in Edmonton and NOT posted them out!?? What!!?? Some of those soldiers had been "stuck" there for 10 or more years --- it was their turn to go to a cheaper place and have someone else replace them. And they did their expensive 10 years with zero benefit of PLD

I never said the military created the housing market. What I said was they posted soldiers into an over inflated market that had a 1% rental vacancy. The Base Commander at the time was quoted in articles stating he was aware of the issue. The point I was trying to make was if the CF was aware of the issue, leadership should have made a better judgment call. I agree that it would not necessarily have been fair to the soldiers that have been in Edmonton for 10 years, but your latter comment makes no sense. Edmonton was not “expensive” prior to 2007. Housing was completely affordable. My neighbors paid 170 for their home……completely reasonable. PLD was only brought in to offset the costs of the ridiculous market and I’m sure will be diminished in the upcoming years as the prices have dropped dramatically.

Quote from: Maritimegal on July 16, 2010, 10:50:16
Just to put a spin on things here. Say my husband did go on IR to Edmonton for 3 years. They are paying to put members up in private accommodations with rent as high as 1800/mth plus Separation expense and low rate dinner allowance. Soldiers were put out of the shacks because accommodations were so limited. Over a three year period the costs would be around $80,000, less than the loss I am taking on my house.

BINGO, but it would not have been your loss would it?

Try finding a civvy employer anywhere who would do such a thing for their employee who had to move!! You won't; they get the old "move or you're fired. period."

Damn, we doooooo have it good here in the CF with the options we get.

It does not make fiscal sense to pay out 80,000 for a soldier to be separated from their family for three years (when the CF promotes quality of life) rather than pay out HEA as per the policy (depressed 20%) which is less. IR is intended for short term separations, not multiple years. The way I see it, it is the crown’s money and leadership is responsible to ensure it is allocated in a way that both makes fiscal sense and contributes to the quality of life of soldiers and families.

 

[armyvern]

...

It does not make fiscal sense to pay out 80,000 for a soldier to be separated from their family for three years (when the CF promotes quality of life) rather than pay out HEA as per the policy (depressed 20%) which is less. IR is intended for short term separations, not multiple years. The way I see it, it is the crown’s money and leadership is responsible to ensure it is allocated in a way that both makes fiscal sense and contributes to the quality of life of soldiers and families.

Gee, 'ya think?? Now there's something I didn't know and have absolutely no experience in.  :

One of my IRs was to replace a member who was Court Martialled, found guilty & released. It was an immediate & must-fill posn. I went out of APS - in the middle of the school year. I was there 2 years. Others refused it with things like "if you post me I'm getting out" or "if you post me, my wife is going to leave me" and "I'll get out if you send me because I've only got 2 years left to go and I'll get out rather than move." Of course, some of them had wives who didn't work and/or no kids but still refused. Not me though - and, of course, there were no positions of my spouses rank/trade in the entire province.

One was to a 2nd location while I underwent trg.

The third one is now because the family is posted to another base and, apparently, there are no MWO posns my trade avail there (except of course for the few that have been there going on 10 and more years now.  :).

What about my QoL?? Maybe you missed the part where I said my family HAS moved 7 times in 22 years.

It's the job WE sign up to do. We move - when and where they tell us to. NOT moving people (as you suggested) and people refusing postings has a trickle down effect onto those of us who DO do our jobs when & where told. We're the ones with way too many postings in way too few years while others sit at bases and rot. Don't like it and don't like our multitudes of options?? Get out; that is an option too.

 

[captloadie]

Glad you brought this up.  A house is an investment.  What are the rules; specifically are there any that would prevent a member, such as in this case, from claiming this loss in their Income Tax Return?

The highlighted part is the core of the current housing meltdown. A house should not be an investment. It should be a home. Would anyone have taken that same 300k and invested it in a medium to high risk stock and hoped for the best? If you want to read some real sob stories from the civvy side, peruse Garth Turner's blog at

http://www.greaterfool.ca/

I don't agree with alot he says, but I do like to chuckle at the poor DINKs who write in and cry they can't afford their home on their 200k combined income.

 

[Occam]

One of my IRs was to replace a member who was Court Martialled, found guilty & released. It was an immediate & must-fill posn. I went out of APS - in the middle of the school year. I was there 2 years. Others refused it with things like "if you post me I'm getting out" or "if you post me, my wife is going to leave me" and "I'll get out if you send me because I've only got 2 years left to go and I'll get out rather than move." Of course, some of them had wives who didn't work and/or no kids but still refused. Not me though - and, of course, there were no positions of my spouses rank/trade in the entire province.

One was to a 2nd location while I underwent trg.

The third one is now because the family is posted to another base and, apparently, there are no MWO posns my trade avail there (except of course for the few that have been there going on 10 and more years now.  :).

What about my QoL?? Maybe you missed the part where I said my family HAS moved 7 times in 22 years.

It's the job WE sign up to do. We move - when and where they tell us to. NOT moving people (as you suggested) and people refusing postings has a trickle down effect onto those of us who DO do our jobs when & where told. We're the ones with way too many postings in way too few years while others sit at bases and rot. Don't like it and don't like our multitudes of options?? Get out; that is an option too.

What you have just described is not an IR problem.  It is a "career manager needs to grow a pair" problem.  They are completely distinct from one another, and if they exercised a little more resolve in issuing posting messages to people who have grown 10-year roots in a posting location, they wouldn't have to force people onto IR anywhere near as often.

 

[Oldsapper]

I would like to join the discussion on the matter Home equity loss:

Posted 2007 to Edmonton from Gagetown in July 2007;
Posted to CFJSG HQ in Kingston, Ontario 2008;
Went on IR 2008-2009 due to lack of home sale; and
On Aug 14 2009 home finally sold at a substantial loss.

I have submitted:
      a.      A request for compensation (adjudication) through Directorate of Compensations, Benefits & Administrations (DCBA), Treasury  Board (TB)

      b.      A request for compensation (Grievance) through Directorate of General Compensations, Benefits & Administrations (DGCBA)  through TB.

Both were refused because TB had not deemed the area of home purchased as a "Depressed Market".  I have completed a submission of compensation for those losses which I believes to be directly related to the reimbursement of actual, reasonable and legitimate relocation expenses which have been incurred by my family and I due to the posting to Edmonton in APS 07 and subsequently being posted to Kingston, ON APS 2009.

Whether or not the 2009 values are formally considered "depressed" or the 2008 values considered artificially high, the fact remains that my family and I incurred a substantial loss due to a combination of my posting and a change in the market.  My expectation as a CF member is that he should not be placed in a position that leaves him and his family in such an extreme financial situation

"I should not gain nor should I lose money in this situation"

I'm currently working with the Ombudsman's Office and I have initiated a Administarial review of Treasury board policy.  WRT changes to allow claims based on the actual change in a market over a posting, as opposed to a market being classified as "depressed".

Has anyone gone this route yet?

 

[PuckChaser]

And people ask me why I'm not buying a house.... Yes, I know PMQs are hard to come by in places like Edmonton, but given the choice between living in an "ok" PMQ or losing tens of thousands of dollars on a house I might be in for a max of 3 years, I'd rather the Q.

 

[armyvern]

What you have just described is not an IR problem.  It is a "career manager needs to grow a pair" problem.  They are completely distinct from one another, and if they exercised a little more resolve in issuing posting messages to people who have grown 10-year roots in a posting location, they wouldn't have to force people onto IR anywhere near as often.

The person that I was responding to made this a QoL issue ... with a recommendation that postings be ceased etc in situations where this "may" occur.

Although I 100% agree with you on your "career manager" statement above --- those career managers would argue that "they were worried about the QoL of those pers who whined and wiggled out of their postings by using QoL arguements". It short, career management considered their QoL, but not that of us others who then actually DO do our jobs by heading to these same posns "others refused based on their family and/or [in this thread's suggestion] financial's Qol".

One man's "good QoL" has the "opposite" effect on the soldier that then ends up tagged to go do the job that has to be done.

Oh, and it wasn't the Career Managers who deemed "retention IS to be the priority of goal of career managers". Careers was only trying to comply with that little directive. We all see how that worked out ... "retaining" someone else after +8 years of rot in one spot caused a whole lot of others to say "well, glad you looked after that guy - but I'm the one who got shafted into an IR because of it so I'm pulling the pin instead of him now. Congrats, you're now stuck instead with the guy who doesn't do his job when/where told."

The pendulum is swinging the other way and back to reality now finally. Refusal of a posting is now grounds for Career action and/or release. Good.

Now, I'm, left wondering when they'll cut-off the absolutely unnecessary IR gravy-train. A friend of mine (a civvy) and spouse have aleady been told they are posted across the country next year after 8 years in the same spot. She has stated flat-out that she "will NOT be moving with him and that he'll have to go IR". No kids at home. She doesn't work. They live in a Q. I asked "what would his grounds for IR be?" She responded that "there's no way I'm moving acrross the country, we're settled here now and he's only got 3 years left to do." I did tell her that "IR was NOT an entitlement" and that "If I were CM, I wouldn't be authorizing it [IR costs] in your case because there's NO substantiated reason (work/child education/home ownership etc) to avoid this posting" so why should the taxpayer pay?? She said "our QoL".  :

Sorry, no kids; no kids in school? Wife that doesn't work, but wife just doesn't want to relocate? "IR benefits denied". <--- That's why I'll never find myself being posted to the career shop. 

 

[PMedMoe]

Now, I'm, left wondering when they'll cut-off the absolutely unnecessary IR gravy-train. A friend of mine (a civvy) and spouse have aleady been told they are posted across the country next year after 8 years in the same spot. She has stated flat-out that she "will NOT be moving with him and that he'll have to go IR". No kids at home. She doesn't work. They live in a Q. I asked "what would his grounds for IR be?" She responded that "there's no way I'm moving acrross the country, we're settled here now and he's only got 3 years left to do." I did tell her that "IR was NOT an entitlement" and that "If I were CM, I wouldn't be authorizing it [IR costs] in your case because there's NO substantiated reason (work/child education/home ownership etc) to avoid this posting" so why should the taxpayer pay?? She said "our QoL".  :

Sorry, no kids; no kids in school? Wife that doesn't work, but wife just doesn't want to relocate? "IR benefits denied". <--- That's why I'll never find myself being posted to the career shop. 

Vern, I'm with you 100% on that one.  :nod:

 

[George Wallace]

Vern, I'm with you 100% on that one.  :nod:

Same here.  Looks like this woman is riding the "Welfare Gravy Train" and hasn't even bought a ticket.  Kick her off before the next stop.

 

[HappyGilmore]

I’m a lurker on this site, but wanted to join this thread. I’m facing a huge loss on my home this summer and am posted in Edmonton. I’ve been having difficulty sleeping from the stress of it all.

I didn’t want to move to Edmonton, but sucked it up just like the multiple deployments over the years and taskings that I’ve done. Leaving my family behind on the opposite coast was not an option. I had been away from them enough. Like others, I could not find a rental accomodation or a PMQ.

Despite my loyal service to the CF, I am considering releasing to avoid separation from my family yet again and the financial hardships selling my home at a loss will bring. I have a very marketable degree and do not need to be in the CF to survive. I joined the service because I take pride in serving my country. I’ve been very loyal with my service, but this situation had made it clear that I need to make my family and their financial well being my number one priority, not my service. After all, they will be the ones who will there for me long after my service ends. I am not going to continue to move my family around if the CF does not offer affordable housing or a better equity loss compensation program.

I’ve written a letter to my MP and am glad to see that people are pushing their cases and hope that the momentum continues.

I want to finish my post by expressing my disappointment in the large number of negative comments from people on here. Why kick your fellow soldiers when they are down? It’s easy to sit back and judge others when you are not in the situation. I don't think the thread was  intended to bash others. The poster was asking if there are other people out there in a situation similar to his.

 

[George Wallace]

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