FREE MONEY

Does money grow on trees? Well still the answer is NO - but the government is giving it away this year and next if you are a first time buyer or have not purchased in the last three years and do not own a home.

Here's some great information regarding the $8,000 Federal tax credit.

This website is very informative. The main question I'm fielding is if people need to wait to get the credit until after they have bought a home.

No, clients do NOT need to wait to buy a home. They can file their tax return now and get the $8K tax credit on their 2008 tax returns BEFORE buying a home. They can then use the funds for down payment (there are no restrictions on what the tax credit is used for). Some folks may just hold on the credit for rainy day funds.

http://www.federalhousingtaxcredit.com/:

Question: If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
Yes. The law allows taxpayers to choose ("elect") to treat qualified home purchases in 2009 as if the purchase occurred on December 31, 2008. This means that the 2008 income limit (MAGI) applies and the election accelerates when the credit can be claimed (tax filing for 2008 returns instead of for 2009 returns). A benefit of this election is that a home buyer in 2009 will know their 2008 MAGI with certainty, thereby helping the buyer know whether the income limit will reduce their credit amount.Taxpayers buying a home who wish to claim it on their 2008 tax return, but who have already submitted their 2008 return to the IRS, may file an amended 2008 return claiming the tax credit. You should consult with a tax professional to determine how to arrange this.

(information provided by Jeff LaViolette [JeffL@equityhome.com] - preferred lender with Equity Home Mortgage).