Homebuyer Tax Credit - Better Than What We Had

Well, we aimed high with the homebuyer tax credit provision of the Obama Stimulus Plan, and while we didn't get the $15,000 in an earlier proposal, the result is still better than we previously had.
The bill, which will be signed any day now, provides for an $8,000 tax credit for first-time home buyers who purchase their principal residence on or after January 1, 2009 and before December 1, 2009. The credit, unlike the previus $7,500 credit, does not require repayment. Income limits do apply.
Here's the guts of the credit: the credit wil be claimed on a tax return to reduce the purchaser's income tax liability. If any credit amount remains unused, the unused amount will be refunded as a check to the purchaser.
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Homebuyer Tax Credit

While President Obama's economic stimulus plan is complex and far reaching, the aspects that pertain to real estate are what are important to REALTORS and the homebuyers currently sitting on the fence. There are several elements of the bill that might just kickstart the real estate industry, mainly some components of the Senate version.

Specifically, it allows a tax credit of the lesser of 10 percent of the cost of home or $15,000, but only for purchases beginning the date the President signs bill. Another key aspect is there is no income limit in this version nor is it restricted to first time homebuyers. And unlike the current tax credit passed by the previous adminstration, there is no repayment due unless the house is sold within two years.

Keep in mind that the law will not take effect until the date it is signed by the President, so purchases made up to that point in time are not affected.

Keep an eye on the final version of the bill - it could have far reaching implications for the real estate industry.