Mr Williamsburg, Revolutionary ideas on real estate!Hampton Roads Virginia

Basically the First Time Home buyer tax credit  reduces a home buyer’s tax liability dollar for dollar up to $7,500 for the purchase of a principle residence that closes before July 1, 2009.  The home buyer would claim the credit on their tax return, and it would offset any tax due that year, up to $7,500.  If the did your taxes and don’t owe any taxes you will receive the full $7500 credit/.

Only first time home buyers are eligible (defined as an individual who has not had an ownership interest in a principal residence in the previous 3 years), and and your income cannot exceed $75,000 for an individual and $150,000 for a couple filing a joint return.

This tax credits,  Unlike most others has to be paid back over a period of 15 years, or when the home is sold, assuming there is equity/ proceeds.  The good news is that no interest is due, so in essence it’s a “free” loan.  In theory  a home buyer would repay $502 each year over 15 years, or reduce his or her tax refund by that amount.

Overall it’s a great incentive for qualified purchasers to enjoy a little extra spending money courtesy of Uncle Sam, ( interest free)  either to spruce up a new home or cushion the new house payment.

To further explore the First Time Home Buyer Tax Credit in the Hampton Roads Area of Virginia give me a call ( 757.254.8136) or email John@MrWilliamsburg.com