$7500 for new home buyers

published March, 2009

As part of the Economic Stimulus Package of ’08, Congress created a refundable “credit” for first time home buyers of $7,500 (a refundable credit: that means that even if you don’t owe tax, you can get the money! Its not just a tax offset.) I’ve put quotation marks around the word credit, because it’s really a no interest LOAN that they expect to be repaid over the next 15 years. They’re talking about making it not-a-loan, but as of today, nothing has changed.

One of my early filing clients who was eligible for this has already received her ‘credit’ funds and is using them to replace a sewer line to her new house.

You must have purchased between April 9 2008 and June 30, 2009, so there’s still time. And it’s not really $7,500, but that’s the maximum credit if your home cost $75,000 or more (you get 10%). And you have to purchase within the United States. If you owned a home in the three years prior, you don’t qualify. Repayments of $500 (for the max loan amount) will be added to your tax starting 2010 and continue until 2024. More details may be had at http://www.irs.gov/newsroom/article/0,,id=187935,00.html.