Monday, April 6, 2009
tax credit will help the economy
Posted By: Sarah Reilly
In a time when people are seeing their 401k’s vanish and their stock plunge there is one positive financial investment that is catching people’s eyes and bring a sense of hope to the economy. This of course is the tax credit for first time homeowners. The program provides a tax credit up to $8,000 for first time homeowners. This program is part of the massive economic stimulus bill that the government has recently put into place. The regulation defines a first time homeowner as someone who hasn’t own a home in the last three years. Therefore this tax credit not only effects the true first time buyers but thousands of former homeowners.
Unlike the $7,500 tax credit passed by Congress last year, this credit will not have to be paid back. The new plan provides a flat 10 percent of the purchase price, up to $8,000, for houses bought on or after Jan. 1, 2009, and closed on by Dec. 1, 2009. The buyer can file in 2009 for refund OR they can amend their 2008 returns and get the money now. They can use the money however they want and it does not have to be paid back.