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).