CHICAGO TAX SMART PROGRAM, Combined with New U.S. Homebuyer Tax Credit - Creates a Bonanza for First-Time Buyers Here!
NEW FED PROGRAM ALLOWS FOR QUALIFIED FIRST-TIME BUYERS TO SIMULTANEOUSLY TAP CITY-SPONSORED CREDIT!
You know, today, right here in Chicago, our Little Real Estate Team saved two of our clients a total of $20,000!
That's because the provisions of the new and revised First Time Homebuyer Credit, as part of the American Recovery and Reinvestment Act, now allows, in certain cases, qualified buyer to obtain simultaneous assistance from local or statewide grant and funding programs.
The story is summed up on the Realtor.org Website today. Here's a chart highlighting important program rules.
As you may know by now, the new First Time Homebuyer Tax Credit allows qualified purchasers - those who have not owned a home within the last three years - to reduce their due U.S. Income Taxes by $8,000. If they owe less than that on their 2008 or 2009 Income Tax Return, they would get the difference in the form of a Tax Refund Check from the IRS.
Qualified buyers must earn less than $75,000 Adjusted Gross Income individually, $150,000 or less on joint returns. Qualified purchases must be owner occupied, and must occur between January 1 and December 1, 2009.
Unlike last year's $7,500 plan engineered by the Bush Administration, this year's credit need not be paid back in $500 installments, with a lump sum of the balance due if the home or condo is sold before the 15-year payback period expires. The new plan money need not be paid back so long as the buyer stays in his new home or condo for only THREE years!
But one little-known aspect of the new plan allows SIMULTANEOUS USE of U.S. and local or statewide-sponsored funds or credits, in many cases, including the Chicago program. Last year's package wouldn't be approved if you also used local funds or credits at the same time.
So, today, a buyer purchasing in the City of Chicago who qualifies for the Fed Credit can also apply for the Chicago Tax Smart Program. It offers qualified buyers a Federal Income Tax Credit based on 20% of the payable interest each year - as much as $2,000 annually - for as long as they own their home!
No minimum stay in the home is required. Income limitations apply, and are a bit more liberal in certain targeted distressed census tracts across the city. A special Homebuyer's Class, prior to the sale closing, is required in order to qualify for the funds.
The potential savings for a buyer who qualifies for both programs - $10,000 the first year, an additional $2,000 during subsequent years.
THIS IS HUGE FOR CHICAGO FIRST-TIME HOMEBUYERS, FOLKS!
And, no, this credit is not the across-the-board $15,000 every-homebuyer credit being talked about in the U.S. Senate last week, but it is far less costly. It might actually be effective. Especially when combined with local savings opportunities!
DEAN MOSS & DEAN'S TEAM CHICAGO
