$7500 Tax Credit Could Change

As many are aware, part of the Bush Administration's stimulus package, last year, offered a 10%, up to $7,500 first -time homebuyer tax credit. First-time homebuyer is defined as anyone who has not purchased a home within the past three years. This was a great idea but few people got on the bandwagon with it because it was designed as a no interest loan. The first two years you would receive a repayment holiday. Then, you were expected to pay $500 per year until it was repaid.

With the Obama recovery Act, however, one of the stipulations, if passed, will be to forgive the repayment of this credit. The credit can be taken in arrears for 2008 taxes so that you don't have to wait until May 2010 to get your money. There is a catch, however, the program is only available until 7/1/2009.

The National Association of Realtors is lobbying hard to eliminate that sunset date and to expand it to all purchasers but it's not known if they will be successful.

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