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I filed my taxes on Jan 22nd and applied for the 7,500 TAX credit. I received my refund already (on feb 6th)
So if this thing is supposed to replace the 7,500 tax credit bill, does that mean that I wont have to pay back the 7,500 now? or how does that work?
I closed on my house on December 5th
If not that's going to upset a lot of people if they already filed their taxes...
Thanks!
The bill being debated, and the $15,000 tax credit contained therin, will not have any impact on a home purchase made last year. No, it does not replace the $7,500 tax credit you got. Yes, you will still have to repay that $7,500 at $500 per year for the next 15 years.
Of course, the bill is still being debated, and may be changed.
Is it just me or does tax credit make you want to actually increase your tax liability, especially if you are single?
Looking at the income limits, it seems like married couples would be in better position as their tax liability is likely higher. Is the AGI limit for single people still $75K? I guess the ability to spread it out over two years would help single people obtain maximum benefit from this. Will be interesting to crunch the numbers when i'm doing taxes this year.
How long is the $15K in free money available for buyers? (I pay over $15K per year in federal taxes, so I qualify for full amount)
As Bill mentioned, this is NOT free money (our government would never be that generous). It is YOUR money, i.e. a dollar for dollar reduction in your tax liability. Obviously it favors the higher end of income earners - as it very well should, considering we are shouldering a larger tax burden.
Of course I'm starting to get chain letter emails from lpeople who want to start letter writing campaigns and lobby the government... "I'm a teacher only making $40K, I don't have anywhere near 15K tax liability but I want the full 15K as it would benefit me more than a higher income earner."
"To make room for added spending, the White House, joined by House Democratic leaders, is pressing to scale back certain Senate-passed tax breaks, including measures intended to boost auto and home sales."
Easy come, easy go. Maybe.
My bet is Obama has heard consensus (from everyone except builders and realtors) that this is the least "stimulating" aspect of the stimulus package.
"To make room for added spending, the White House, joined by House Democratic leaders, is pressing to scale back certain Senate-passed tax breaks, including measures intended to boost auto and home sales."
Easy come, easy go. Maybe.
My bet is Obama has heard consensus (from everyone except builders and realtors) that this is the least "stimulating" aspect of the stimulus package.
This stinks. I had a feeling the House Democrats were going to pull a stunt like this.
My best guess is that they will go ahead with a $7500 tax credit again income but will let all homeowners apply instead of first time homeowners.
In addition, they will impose an income limit on who gets to qualify for this credit. They'll probably impose a 100K singles/200K couples type of income limit and completely phase out the tax credit at a certain income (My best guess is 125k/250K).
Who do they think have the money to spend on homes? Who are the least likely to default? None of my friends who make over 500K a year are in default of any of their homes. These are hard working Americans. They pay more than "their fair share" of taxes. They didn't inherit this money. They either started their own businesses and took risks or they went through 8-12 years of schooling beyond high school.
House Democrats are idiots. There is so much bickering going among themselves. The Republicans are laughing with all this in house arguing. This is like patching a big leak in a dam. Either you let the whole housing industry sink and just start all over again (this involves just letting everyone in danger or in current foreclosure lose their homes or you apply a real stimulus that helps all homes (big ones/small ones) and helps all people.
Who do they think have the money to spend on homes? Who are the least likely to default? None of my friends who make over 500K a year are in default of any of their homes. These are hard working Americans. They pay more than "their fair share" of taxes. They didn't inherit this money. They either started their own businesses and took risks or they went through 8-12 years of schooling beyond high school.
House Democrats are idiots. There is so much bickering going among themselves. The Republicans are laughing with all this in house arguing. This is like patching a big leak in a dam. Either you let the whole housing industry sink and just start all over again (this involves just letting everyone in danger or in current foreclosure lose their homes or you apply a real stimulus that helps all homes (big ones/small ones) and helps all people.
I just don't understand why as a nation, we should encourage real estate investment. This makes real estate a more lucrative investment, and drives up prices for people who just want to own shelter, forcing them to either borrow more money against their incomes, or save for longer periods of time. Why are these desirable?
I really, really, don't understand why we should encourage investment into multiple residences. If anything we should tax the hell out of 2nd or 3rd homes. This has to do with the $500k earners you talk about. Why do we want $500k earners to invest in housing? Why not encourage these wealthy people to start businesses, or invest in other peoples' businesses? Wouldn't that create more productive jobs than real estate investing?
The way I see it, you can encourage home appreciation, but it will come at the cost of unaffordability at the middle incomes, and higher defaults as middle income people need to put themselves in riskier and riskier positions to be a homeowner. Is your goal a society where all the $50k earners rent from the $500k earners, who own all the property? That seems to be the scenario that these types of homebuying tax credits are moving toward.
I just don't understand why as a nation, we should encourage real estate investment.
I really, really don't understand why we should encourage investment into multiple residences.
Neither of the homebuyer credits apply to anything other than someone's main residence. So neither of them 'encourage investment into multiple residences'.
Are you equating 'real estate investment' with 'home ownership'? If so, I don't see your objection. There are good reasons to encourage home ownership, among which are studies that have shown that populations that are largely transient have negative effects on the economic stability and overall desirability of a given area. That's one reason why areas such as Long Island have always structured their zoning laws so as to discourage (or at least make it more difficult or complicated for) rental properties.
$15K credit does encourage owner-occupied investment
If this provision were to pass (looks unlikely in its current form) to give people like myself looking to buy another primary residence where I have to live for 2 years $15K in tax credits, it would encourage people like myself who already own property to buy another place, so long as I live there 2 years. This fits perfect into my overall real estate investment strategy as I typically buy a place, live there 2-3 years and then buy another. I am getting ready to buy my 3rd place, especially if this bill passes. I do see prices continuing to drop for the rest of this year so I would buy at the end of Feb 2010 to minimize the price I will pay and still receive the credit.
However, it looks as if this bill may not pass and maybe it will only be for $7500, though I hope it does go to not just first-time homebuyers, as this would exclude me from benefitting as would income restrictions.
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