President Bush recently signed a bill that allows first time home buyers to use a $7500 tax credit. This tax credit can be used on any home purchase that is made between April 9, 2008 and July 1, 2009.The amount of credit will be 10% of the cost of the home., not to exceed $7500.00, the credit will be phased out at a certain income level, ( Single taxpapers with incomes up to $75,000 and married couples with incomes up to $150,000 quailfy for the full credit.)
Another factor is that the tapaper must be a first time home buyer. This includes the purchaser's spouse. A property is eligible for the credit regardless of if it is a single family residence or a condo etc. This is only if the purchaser plans on living and using the residence as a primary residence.
The purchaser must keep in mind that the tax incentive is not a full credit. A portion of the credit must be repaid each year for 15 years, essentially making it an interest-free loan. If a home is sold before 15 years, then the remainder of the loan will be repaid from the sales profits. If there was insufficient profit, the remaining credit will be forgiven.
Combine this with the other tax benefits that you will have as being a homeowner, such as being able to write off mortgage interest and you have a great incentive to get out there and buy that home! Call Natalie Larsen with Market Edge Real Estate at 801-458-7215 or email me at mail@NatalieLarsen.com for more information. As always check with your attorney or accountant. Have a great day!