My mortgage officer friend forwarded this on to me last week.  If you are planing to purchase a first home, there is a little assistance from the government.  She advised me that legal fees and disbursements are deductible if you qualify.

The Fedral budget passed for 2009 introduced a new non-refundable tax credit based on an amount of $5,000 for first-time home buyers who acquire a qualifying home after January 27, 2009 (i.e. the closing is after that date).  The credit for a taxation year will be calculated by reference to the lowest personal income tax rate for the year and is claimable for the taxation year in which the home is acquired.

An individual will be considered a first-time home buyer if neither the individual nor the individual’s spouse or common-law partner owned and lived in another home in the calendar year of the home purchase or in any of the four preceding calendar years.  A qualifying home is one that is currently eligible for the Home Buyers’ Plan that the individual or individual’s spouse or common-law partner intends to occupy as the principal place of residence not later than one year after its acquisition.

For full information, visit http://www.budget.gc.ca/2009/plan/bpa5a-eng.asp#3

As I see this, if the government is willing to give a break, it might not move you to buy but for those who are buying anyway, it sure will help.

R. Greg Osmond is a Platinum Award winning Realtor serving St. John’s and surrounding areas, Newfoundland and Labrador for over 20 years and can be reached at 709-895-2500. Visit http://www.rgregosmond.com/ for further information.