Home Buyer Tax Credits Worth $7,500.00

Home Buyer Tax Credits Worth $7,500.00

If you are in the market to purchase a home for the first time in your life and want to take advantage of the down slide in the housing market, the government has just given you 7,500 more reasons to sweeten the deal.

On July 30, 2008 the President of the United States Signed into effect the Housing and Economic Recovery Act of 2008 or better known as HR-3221. This law basically created a special tax credit for first time home buyers to purchase homes and take advantage of $7,500.00 worth of tax incentives if a home is purchased between April 9, 2008 and July 1, 2009.

Let me share some important details about this program further. First of all to be eligible for the tax credit you must meet the following guidelines:

The tax credit is only available for first time homebuyers as defined by the government as being a buyer who has not owned a home in the last 3 years.

You must buy and close on the new home before April 9, 2009. If you buy after this date, the tax credit is no longer offered. So make sure you buy during this time frame.

The credit is available to single person taxpayer with an adjusted gross income of $75,000.00 or less or married jointly taxpayers with an adjusted gross income of $150,000 or less to get the full credit. Some Credits are available for those making more than the limits listed here.

(Please seek information from a professional tax preparer or certified tax preparer. I am not a tax professional and cannot give you tax advice.)

Now please be aware that anytime the government offers something for free, there is always some type of catch. The catch in this case is that the tax credit is not a free gift. This tax credit must be paid back to the government over 15 years at $500.00 a year starting with the following tax return after you received the tax credit. For example if you take the tax credit this year in 2008, then you start repaying the $500.00 a year on your 2010 return.