Real Estate Northern Illinois – $15000 Home Buyer Tax Credit – Some things to know

Homes on Street in Palatine Illinois

Some facts about the new Home Buyer $15,000 Tax Credit.

Senator Johnny Isakson, a republican from Georgia introduced the provision.     It would provide a home buyer tax credit of as  high as $15,000 or 10 percent of the home’s price tag, whichever is less.   Who would qualify?    Anyone buying a primary residence starting the date of enactment and continuing for one year.       Here is  a list of some of the  things you need to know about the amendment:

1.     If before the enactment date you have already completed a purchase of a home, you would not qualify for the new home buyer program.      If you qualified for the $7500 new home buyer tax credit you would not also qualify for the new credit.  

2.    The term “Sunset” means that the $7500 credit will be  no longer available  for new home purchases on the day the $15000 is enacted.   If you have the $7500 credit as of the date of enactment of the $15000 credit, that is your credit, you don’t switch over.

3.     The $15,000 home-buying provision is a part of the economic stimulus package and the odds of it becoming law is very high.The  house of representatives  is putting pressure on the Senate to pass this version of the bill as they have already passed their version.      The National Association of Realtors and the National Association of Home Builders are strongly supporting the $15000 tax credit, and most likely will remain in the stimulus bill that is signed into law.    The housing market drives everything else.   Fix the housing market and we are well on our way to recovery.

4.     The tax credit does not need to be paid back unlike the $7500 first time home buyers credit that was to be repaid in 17 years and was a non interest loan.

5.      The $15000 tax credit applies to any home,  including  a condo, a house, foreclosed, new,  or previously owned with no income limit or restrictions on the home buyer.   You must use this home as your primary resident and occupy it for at least 2 years.

6.       If you buy the home in 2009 you can still file your taxes and take a credit for 2008 like you bought the home on 12/31/2008.  

7.     There are limitations to the tax credit taken in one year.   It can be split into 2.   The limitation is based on the amount of tax liability given in one year per couple or individual.   This did not exist with the $7500 first time home buyer credit.  

Summary:    If you make over $80,000 – $100,000 you can take the full credit in one year.   If not it can be divided by 2 but may not add up to the full $15000 credit for home buyers.  

If you have specific questions about this, call your accountant to find out  what your credit could be.    The Julie Anne Real Estate Team is always ready to help you search  for and find your next home.  

Please note: I am not an accountant and I am not providing tax or legal advice. I make no claims that the post is accurate or calculated correctly. For specifics regarding your own situation, contact a qualified tax professional

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Posted By:   Julie Anne – The Julie Anne Real Estate Team at Keller Williams Success Realty

Northern Illinois Real Estate AgentBarrington – Deer Park Real Estate Expert and surrounding areas

847-620-5815    julie@homesbyjulieanne.com

What is my homes value?                          Homes for sale in Northern Illinois, Barrington Homes for Sale  – Deer Park Homes for Sale

The IRS has come out with Form 5405  (http://www.irs.gov/pub/irs-pdf/f5405.pdf) for taxpayers interested in claiming the Tax Credit for new home buyers, either for 2008 or 2009 (click on the above link to print the form, thereby making the credit more real!)