Good news coming from DC! Or potentially good news….
Both the House and Senate versions of the newest stimulous bill propose improvements to the previously enacted $7500 tax credit (from last summers Housing Recovery Act) for new home buyers. If either version of the new bills pass they will make the $7500 a tax credit that no longer requires repayment. As it stands now, the tax credit exists as a interest free loan that can be paid off over a span of up to 15 years.
Some key points to keep in mind:
- to qualify you must be a first time home buyer (FTHB) (no home owned in the last 3 years)
- the credit can only be used on a primary residence
- for the full credit the FTHB must earn less than $75,000 or $150,000 for a couple and the benefit phases out completely at $95,000 and $170,000, respectively.
- You must own the home for at least 36 months
- Credit is refundable! Example: buyer owes $5000 in taxes. they can still get a $7500 refund ($2,500 net)
- depending on which bill is ratified, the credit will be available to the end of June (House) or the end of August (Senate)
The biggest worry now is that, by the time this is implemented, there may not be a lot of time to take advantage of it.
