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$8'000 Tax Credit

In Colorado, President Obama signed the massive economic stimulus plan into law making the $8,000 home buyer tax credit official.

The American Recovery and Reinvestment Act of 2009 is a $787 billion stimulus package meant to save or create as many as 3.5 million jobs. The package allocates money for tax relief, state and local fiscal relief, infrastructure and science, protecting the vulnerable, health care, education and training, energy and other things.

This stimulus bill will help lead our nation towards debt levels not seen since the darkest days of World War II and represents the largest federal stimulus package in our nation’s history.

The final plan set aside stimulus money at the cost of $2 billion - $8 billion for first-time home buyers as well as incentives for home owners that make energy saving improvements to their existing home. Although some incentives for home buyers were included in the final plan, the plan’s home buyer incentive fell short of the $15,000 home buyer tax credit requested by home builders and housing professionals across the nation.

$8,000 Tax Credit For Home Buyers

The $8,000 tax credit for first-time home buyers should entice some first-time home buyers to “jump-in” and buy a home, but it may prove to do little in increasing overall demand as first-time home buyers represent a small percentage of the entire market. Only time will tell if the tax credit is effective.

• Available only to first-time home buyers
• The tax credit is not a loan and does not require repayment* *If the home is sold within 3-years, the $8,000 tax credit must be re-paid
• The tax credit reduces the home buyer’s tax liability; if the buyer’s liability is less than $8,000, the remaining credit will be issued as a check
• Home purchase must be for a primary residence
• The credit is available on home purchases between January 1, 2009 and December 1, 2009
• If you are single and make $75,000 or more, or are married and make $150,000 or more, you do not qualify for the tax credit
• The credit is not eligible if the seller is a relative of the buyer

 

No more Down Payment Assistance for FHA?

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