First Time Home Buyers Tax Credit Extension Coming

A first time home buyer tax credit extension is currently being explored. The current first time home buyer tax credit is in place to try and convince people that they can afford to buy a new house, and when they complete their taxes for the year, they can apply for the first time home buyer tax credit. The home buyer tax credit right now is $8,000 to those who are purchasing a home for the first time. This can help a lot when it comes to affording a house, because it means during the first year of the purchase, the home buyer will get back $8,000 free and clear. It's a good program that many people have taken advantage of, but it is about to expire.

November 30th, 2009 is the last time that the current first time home buyers tax credit will be beneficial to new home purchasers. Up until that date, home buyers can get the $8,000 without having to pay it back to the Government in the same fashion that some prior first time home buyer tax credits had worked. Prior to the current policies, the first time home buyers tax credit worked like a loan, where tax payers could deduct it from their taxes, but would have to pay it back in the long-term. The new idea has helped out a lot of home buyers, and it has been really easy for people to qualify as well.

For the first time home buyers tax credit to survive in its current form, there will need to be an extension or an adjustment passed by the Senate, and they seem to be working hard on it behind the scenes. The exact parameters of the new plan haven't been revealed yet, but it should be similar to what has been in place for the past year or so. With so many people just starting to come out of deep financial trouble, it would make a lot of sense to extend the credit, because a lot of people could still be looking to purchase a new house in this market.

A few of the direct benefits of extending the first time home buyers tax credit include that it could help a sluggish home sale market, and that it could continue to stimulate the real estate sector. There are an awful lot of houses for sale out there still, and extending the tax credit can help the sellers as much as the buyers, because it will continue to create more people being active in the process. The Senate should definitely extend the first time home buyers tax credit, and if they can, make it easier for people to get that tax rebate back quicker when they file their taxes for the 2009 year.

Sources:

Senate Working on Extension