Feb 2009 Stimulus Package & First-Time Homebuyers

IRS ARTICLE:
Tax Credit to Aid First-Time Homebuyers; Must Be Repaid Over 15 Years
http://www.irs.gov/newsroom/article/0,,id=186831,00.html

Congress Strikes $789 Billion Stimulus Deal

http://online.wsj.com/article/SB123436825805373367.html

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First-time buyers get $8,000 tax credit in stimulus bill

First-time home buyer tax credit details reported today in a Wall St. Journal article:

Home buyers who hoped for a $15,000 tax credit to buy a new home, as promised by the Senate, will be disappointed. A proposed $35 billion credit to support home sales was jettisoned in favor of a more modest $2 billion to $3 billion provision.

The proposal would eliminate the repayment requirement in an existing tax credit for first-time home buyers, and raise the credit to $8,000 from $7,500. Congressional aides cautioned Wednesday that the credit's size was still subject to negotiation.

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Response post:

LETS GET THIS STRAIGHT PEOPLE:

The devil is in the details..

First off, this housing "credit" isn't stimulus at all. Don't be upset. You thought you were going to get 15K right off the bat? Think again.

Assuming you qualify (buyers in 08 will get the shaft),

1) The sum of WHATEVER the housing credit is (they seem to change it everyday) will BE SPLIT into two tax returns. Hence, two years.

2) The biggest catch of em all is, YOU MAY NOT BE ELIGIBLE for that full credit!! IT depends on your TAX LIABILITY. So the higher your income, the closer you will be to getting the full credit.

3) You can claim this credit in the 2008 tax return (even though you've purchased in 09)

4) You do not have to repay this credit.

5) You do not have to be a first time home buyer for this credit.

Posted by: DiggySRQ