As of this writing, the Senate approved a $15,000 homebuyer tax credit in order to stimulate sales and soak up the excess inventory of unsold houses. The amendment expands an existing $7,500 homebuyer tax credit to $15,000, or 10% of the purchase price, whichever is less. It is our understanding that a borrower must also apply a minimum of 5% towards the down payment in order to qualify. Unlike the $7500 tax credit of 2008 the 2009 tax credit is available to all homebuyers purchasing a primary residence only. It is nonrefundable, which means that buyers can only claim the credit if they owe income taxes and can claim the credit on two years of tax returns. In addition, the 2009 tax credit does not have to pay back so long as the borrower lives in their home two years. For example, buyers could claim a $7,500 credit in 2009 and a $7,500 credit in 2010. However, if a family’s tax liability is less than $7,500 for two consecutive years they would not receive the full value of the credit. The Senate version requires buyers to pay back the credit if they sell the house less than two years after they buy it. For more information on this subject check out:
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