My New Blog

Tax Credits:

First-time buyers and people who have not owned a home in the past three years will get a $7,500 tax credit if they purchased a home on or after April 9, 2008 or if they purchase one before July 1, 2009.

Income limitations are:

§ Married couples with incomes less than $150,000 qualify for the entire tax credit. The tax credit phases out for married couples with incomes between $150,000 and $170,000. Couples with incomes exceeding $170,000 do not qualify for the tax credit.

§ Singles with an income less than $75,000 qualify for the entire tax credit. The tax credit phases out for singles with incomes between $75,000 and $95,000. Singles with incomes exceeding $95,000 do not qualify for the tax credit.

The tax credit is really an interest-free loan from the government that must be paid back over fifteen years, in increments of $500 a year.

§ If you die, your heirs do not have to pay back the remaining balance.

§ If you sell your home before fifteen years have passed and your home’s appreciation is less than the amount you have to pay back, the loan is forgiven.

• If you turn your home into a rental or investment property, you must pay back the balance due.