Friday, February 6, 2009

Only 4 Months Left to Earn $7500 From Your Rich Uncle!!!

Have you been looking for a home? Thinking about it? It is your first home (or have you not owned a home in 3 years)?STOP! Stop looking & considering. Start FINDING one.If you are a first time homebuyer, you must close on the purchase of your first home by the end of June* to earn a $7500 tax credit. Note that this is a CREDIT not a deduction. If you are expecting a refund, it will increase your refund by the amount of your credit. If you will owe taxes on your 1040, your taxes will be reduced by the amount of the credit and you will receive a refund if due. Before I continue, as with any tax advice here or from any source that is not your trusted professional, you should review this with your trusted professional to apply to your situation.First time home buyers (and those that have not owned a home in the last 3 years) can claim a tax credit of 10% of the purchase price of their primary residence. The maximum credit is $7500 and there are income limitations on who can claim.EXTRA GOOD NEWS - Already buy your first home? Did you buy it after April 9, 2008? You can claim this credit also!MORE EXTRA GOOD NEWS - If you buy your home in time to claim this credit, you can use the credit on your 2008 taxes even though your purchase may be in 2009! This will get the money in your hands sooner!The catch? (Isn't there always one from Uncle Sam?) You have to pay this credit back - over 15 years. However, you don't have to start paying it back until 2 years after your claim year. The payback is done every year on your 1040, so you can adjust your withholding to take an extra $10/week if you think that may pose a problem when you file. If you sell your home before then and make a profit (above all costs to sell), you have to pay back the amount you still owe on your claim. There are other payback forgiveness provisions, but that again is where your trusted professional should step in to advise you. He needs to earn his money, too.At worst case, this is a 15-year, interest-free loan. At best case, this can help you redecorate and set up your new home the way you want it!If you have not yet begun working with a Realtor, let me know. I will be invaluable in your search efforts and advise you properly on the selection of and offer for your new home.*So, why only 4 months left if the clock stops at the end of June? Because you must CLOSE your purchase by then. It generally takes 30 days from offer to close. Give me a call and let's get started! (918) 361-3404 or

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