Tax Incentives obtainable – The First Time Home Buyer Stimulus
With housing prices at new lows, there’s plenty to interest first time homebuyers. The Federal government is offering a first time home buyer stimulus in the form of an $8000.00 tax credit to encourage first time buyers. The opportunity isn’t unlimited though – it ends December 1, 2009.
Here are six things you’ll want to know about the obtainable stimulus for first time home buyers:
1. The $8000.00 credit doesn’t have to be paid back and it applies only to first time purchasers who are buying a principal residence.
2. The definition of a ‘first time home buyer’ for this stimulus package is a person who has not owned a principal residence for three years before buying a house. If you owned a vacation home, you can nevertheless get the credit.
3. The tax credit is obtainable only to those buying a home in 2009 on or after January 1, 2009 and before December 1, 2009.
4. Income limitations apply. If you’re single and your modificated gross income is $75,000 or less, you are entitled to the tax credit. If applied to a associate, the modificated gross income can be $150,000 or less. The amount of the credit declines if modificated gross income is more than these amounts.
5. already if you don’t have much tax liability, the credit is refundable so you can nevertheless take advantage of it.
6. Recapture elements of the stimulus package average that the buyer must live in the home for three years before selling. There are exceptions in the case of a death or divorce.
This stimulus credit is an improvement over the $7,500.00 credit offered in 2008 in more ways than just the dollar amount involved. It doesn’t have to be repaid if the rules are followed, so the $8,000.00 is in effect a gift to home buyers from the Federal government.
Why is the government being so generous? Home buyers contribute build communities, enhance neighborhoods and make them more stable. People who are home owners also help the economy grow – for each home buy, there are purchases of garden equipment, patio furniture, plants for landscaping and more. Interior purchases may include furniture, linens, paint, flooring, appliances and other items. And, if the character needs improvement, there may be a need for the sets of an electrician, plumber or contractor.
Homes are the financial bedrock of our country. Encouraging the buy of homes primes the ‘economic pump’ that helps communities prosper and attract businesses, educational institutions and new residents.