$8000 first time home buyer tax credit available for first time home buyers according to Obama's new economic stimulus packageThis post is about Federal first time Home Buyer tax credit.

update:Read my latest post on $8000 first time home buyer tax credit-details explained for latest updates.


Latest News on housing tax credit: US house of representatives has approved Obama's economic stimulus package of $789 billion. The republicans did not block the economic stimulus plan. This is good news and a significant development, because the earlier version of this stimulus plan was blocked by the republicans. Part of this new stimulus package, provides a $8000 housing tax credit for first time home buyers. This housing stimulus is designed to boost the ailing US housing market. The original stimulus package had a proposal for a $15000 housing tax credit. But unfortunately the earlier verstion with $15000 tax credit had to be rolled back to a version with $8000 tax credit in order to get majority support. Previously a $7500 housing tax credit was available to first time home buyers was $7500, so this housing tax credit is still $500 more than the previous one. Note that the senators are yet to vote on the economic stimulus package and then later it will be signed by the president into a law (on 16th February).

Explaination - How does the $8000 home-buyer tax credit work?
Important things every home buyer must know about the $8000 housing tax credit.
  1. Difference between $7500 tax credit and $8000 tax credit: Unlike the $7500 tax credit this $8000 tax credit does not need to be repaid back. The $7500 tax credit was essentially an 'interest free loan' for 15 years. It is still not clear whether this is a refundable credit. A refundable tax credit means that in case the total taxes you pay to IRS are less than the tax credit, then you can actually get a refund for the difference from IRS!
  2. Available to only first time home buyers: The 1st time home buyer tax credit, as the name suggests is available only first time home buyers. If you have already bought a house before, there is no tax benefit or tax credit for you.
If you have any further questions you may visit First time Home Buyer Tax Credit update or I encourage you to leave a comment. I will update the exact income limits and other details about the $8000 home buyer tax credit after the bill is signed into a law.

Feb 14, 2009


Anonymous February 18, 2009 at 10:39 PM  

I'm confused, I thought that the $7,500 repayment option was suspended. I was waiting to hear whether it is factual that we don't have to repay the money if the tax credit is taken. Please update, I thought President Obama and congress was working on suspending the repayment option.

Custom Search

  © 2008