Housing and Economic Recovery Act of 2008

In 2008, a bill was passed that has not received a lot of press. It is the Housing and Economic Recovery Act of 2008, also know as the First-Time Homebuyer Tax Credit. This credit is actually a tax free loan from the government for people that have either never bought a house before or have not owned a principal residence in the 3 years prior to the purchase. The amount of the credit is 10% of the cost of the home not to exceed $7,500 and can be used on any single family residence including condo's and co-op's that will be used as a primary residence. This is designed for people making less than an adjusted gross income of no more than $75,000 per year or $150,000 per year if filed jointly and applies on purchases made on or after April 9, 2008 through July 1, 2009. This is a loan that has to be repaid. The repayment is made through your yearly income tax filing over 15 years. The yearly payment is 6.67% of the credit you were given. If the home is sold before 15 years, the remainder of the credit will be paid back at the time you sell your home. For more information feel free to call me at 574-370-8156 or contact your accountant as they should be up to date on the ins and outs of this program.