By Jerry Davis, CPA - Here is a real doozy from congress. New tax legislation allows home buyers who have not owned a home in the last three years to take a tax credit up to $7,500 for buying a new home. But wait...you do not get to keep the credit...you have to pay it back at $500 per year over the next fifteen years.
My guess is this tax credit will not benefit very many people. Mortgage companies were loaning money to anyone and everyone over the last three years. With the way the credit market has tightened, I just do not foresee that many first time home buyers between April 1, 2008 and July 1, 2009 (the period the tax credit is available).
And why does congress have to keep making things so complicated? Either give the credit or don't give the credit.
Am I wrong in my observations? let me know your thoughts by commenting.