Congress has acted and I am very pleased with some of the reforms and incentives coming from Washington. The most exciting, I believe, is the new $7500 tax credit for first time homebuyers (defined as someone who hasn't owned a home in 3 years).
If you purchased a home or will be purchasing a home between April 9, 2008 and July 1, 2009 you are eligible for this credit!
Please understand that this is a "credit" not a deduction. That means that if someone owes $10,000 in taxes, they only pay $2,500 because they apply the $7,500 credit!
But it gets better ... this $7500 is also a "refundable" credit. So if someone only owes let's say $5,000 in taxes, they will actually get a $2,500 refund.
Remember the credit goes away July 1, 2009. So if you don't buy before then...you will lose out.
You may view a helpful Q&A prepared by the National Association of Realtors that I think will help explain how this program works by clicking on the link below:
Click Here For More Information Regarding The $7500 First Time Home Buyer Tax Credit
And make sure to remember to talk to your tax preparers about this credit at tax time.
Remember that a first time home buyer is defined as someone who has not owned a principle residence in the previous three years.
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