Did you know that part of the latest economic stimulus package a First Time Home Buyer Tax Credit incentive was passed?  Have you been wondering what the incentive is all about and who qualifies for it?  Maybe you or someone you know does.  Let me tell you a little about it and why I am so excited about it.

The tax credit is for anyone that has not bought or owned a personal property for the last three years.  This includes buyers that may have owned a home in the past, sold their home and rented for the last 3 years and are now interested in purchasing a property.  Anyone that owns rental property or vacation property, but don't own there personal residence (a property in which they reside in over 50% of the year and claim a homestead exemption on) also qualify as first-time homebuyers. You can even qualify if you build a home on property you own as long as you complete the construction and inhabit the home before December 1, 2009.  There is a maximum income limit for those wanting to use the credit option.  For married couples it is $150,000, for single buyers, it is $75,000.  There is a phase out up to $20,000 for earners over the limit.

The credit limit is set at 10% of the purchase price of the property up to $8,000.  So any property over $80,000 limits your credit to no more than $8,000.  Not a bad return for making a good investment in your life.

You have to close the purchase of the property between January 1, 2009 and December 1, 2009 to be able to get the tax credit.  You can file on your 2008 or your 2009 taxes.  Already filed your 2008 taxes, but want the money back now?  Easy problem to solve, simply file an amendment to your 2008 taxes along with the form 5405 from the IRS.  If you so choose, you can hold off and claim your credit on your 2009 taxes instead.  The same form will be used if you file in 2009.

Did you know that real estate has only dropped 18% in value in the same amount of time that the stock markets have dropped 55%?  That is over three times as much of a decrease in the stock markets as in the housing market.  I'm sure that leaves a question in your mind as to why would you buy a home when we are seeing a decrease in the markets?  To put it simply, interest rates are at an all time low, sales prices are down, therefore you are able to get more house for your money, and if you meet the qualifications I outlined above, you are able to receive a large tax credit on your purchase (that is like an instant return on your purchase).

So now that you are all geared up to buy, what do you need to do?  Contact me, of course!  I would love to assist you in your home buying process.  If you are not in the market to buy right now, but know someone that is; please pass on my information to them, or their information to me.  Your referrals are the heart of my business.