So, the current $8,000 First Time Home Buyer Credit is coming to an end on November 30, 2009. To quickly review the program, those people who has not lived in a house they own for the last three years and have a combined income of $150,000 (or $75,000 for individuals) or less and will live in the house for a three year period will get a $8,000 gift from the federal government in the form of a tax credit if they buy a house/townhouse/condo. You MUST close escrow on or before November 30, 2009. If you pay less than $8,000 in taxes, it doesn’t matter as the government will give you back the whole $8,000 as a refund. DISCLAIMER: I am not a tax professional and cannot give tax advise, so refer to your tax professional for the details of the program or click here to go to the IRS site.
In my last blog, I mentioned that the $8,000 was a "nice to have" and it is nice to have money as your cash flow tend to be tight after you buy a house. You need to buy blinds, curtains, refrigerator, stove, washer/dryer, re-sod the lawn, replace the fence, paint…. There are currently bills pending in both the Senate and the House of Representatives to extend the credit through 2010. There are components of the bill which may increase the tax credit to $15,000 or to apply it to any home buyers (not just First Time Home Buyers). But the current odds are that the bill will simply be extended through 2010 with no expansion in the amount or the buyer–just like it was in 2009. You can read about it here in the Chicago Tribune website.
By the way, I am periodically running "First Time Home Buyer Seminar" about once a month now, so come learn about the housing market and how to buy a house–it’s free and there are no obligations! Click the link below to find out more about it.