Wednesday, August 13, 2008

First Time Buyer Tax Credit

As part of the (900 page) Economic Stimulus Bill President Bush signed last week, First Time Homebuyers and Homebuyers who have not owned a home in the last three years will be able to deduct $7,500 from their income for that tax year. This tax credit is more technically a loan that has to be paid back over the next fifteen years after the tax credit year. Here’s how it will work:

First year: Income = $50,000. Reported income = $42,500.

Year 2-16: Income = $50,000. Reported income = $50,500

All home buyers taking advantage of this credit should use an experienced and knowledgeable tax preparer when filing their taxes to ensure that it is calculated and reported properly. I would be happy to provide a referral to any of our clients looking for a professional to provide them with more detailed help with this tax credit. Feel free to email or call me at the office (864-527-7685).

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