First Time Home Buyer Tax Credit
Singles and couples who never purchased a house before will be given up to $8,000 government subsidy when they purchase a house from until the end of December 2009. This is what the American Recovery and Reinvestment Act (ARRA) passed by the Senate as part of President Barack Obama’s economic economic rescue package. The intention of this law is to help the real estate industry of the country by encouraging more people to purchase houses.
This is a welcome news not only to the real estate industry but also to the public who have been planning to buy their dream house but didn’t went ahead because of the economic crisis. For first time home buyers, this is the perfect time to realize their dreams. The prices of houses are falling and the additional first time home buyer tax credit will even push the net prices down even more.
Couples who have MAGI (modified adjusted gross income) of $150,000 and singles with MAGI of $75,000 are eligible. It gives a maximum credit of $8,000 or 10% of the cost of the house purchased. Home buyers should settle into the house for 36 months immediately after they bought it.