$8,000 homebuyer tax credit in stimulus

There is a bill, a stimulus bill, up on Capital Hill, that might be of interest to you if you or someone you know is looking for their first home.It could mean $8,000 in your pocket.

Earlier this week, the real estaet industry was abuzz about these credit. Orginally, the provision was set to provide a $15,000 tax credit, which did not need to be repaid, put that was wiped out of the bill while it was being batted around congress. The credit would have been available to anyone who bought a home within the next year, regardless of income. This was to be an escalation of the current tax credit of $7,500, which is for first-time homebuyers only, has income restrictions,  and must be repaid.

The bill is still being worked on at this point, but it seems that an $8,000 tax credit will replace the original in the final bill. At this point it sounds like this version will have the same restrictions as the existing credit, but will not have to be repaid. The credit would be available to any first-time homebuyer who purchasers before August 31, 2009. Its possible the language of the bill will be altered to require repayment (which happens over 15 years), but we won’t know for sure until next week.

If you or someone you know is a potential first-time homebuyer, considering the great interest rates and great foreclosure buys on the market, this might be something to pay attention to. Whether you like the stimulus bill or not, its hard to turn down a $8,000 check. I’ll have more on this once the bill is final.

UPDATE – The bill has just passed in congress and will be voted on by the senate tonight. The exact details of the current provision are still unclear. The bill is 8 inches thich (seriously) so I guess they might not even know what they are agreeing to. Additioally, the State of Missouri is trying to do something similar with a $1,000 tax credit. More on these next week.

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