Let’s Get Real Estate

First-time home

buyers tax credit

Dear Jan: I heard that in October the first-time buyer’s program is going away. We have saved our down payment and will buy in November. Are there any other first-time homebuyer programs? TW

Dear TW: I assume you are talking about the Nehemiah Program, which as we go to print has not been extended and will expire Oct. 1, 2008. The good news is that there is a new tax credit now in place. It is a tax credit for first-time homebuyers.

This means if a first-time homebuyer purchases a home this year, then when they file their 2008 tax return, they will get a tax credit of $7,500. So let’s say that if you would have gotten back $1,000, you will now get $8,500.

There are income limits. The only caution is the credit must be paid back, which means it is like a zero-percent loan. The first $500 payment in due is 2010 and must be paid back in 15 years. If you sell sooner, the remaining unpaid credit is due from the profit on the home sale.

Your home purchase must be made between April 9, 2008 and before July 1, 2009. This credit is a great tool to get a buyer into a home, so all first-time homebuyers should call their real estate agents now to get in on this great deal. Happy home hunting and happy tax time.

If you have a real estate question you would like answered, e-mail Jan Zufelt at janzufelt@telebyte.com; put KCN in the subject line.

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