I have promised to keep you updated on the changes in the tax credit. Seems I am a little behind. The new wrinkle isn't really applicable to our market. The Feds authorized that the tax credit be "monitized". That is, you could borrow against it, and use it for a down payment. Here is the problem. As often happens in IL our legislature has been caught napping. There is no program in effect for IL home buyers to monetize the tax credit. At the glacial pace Springfield moves, the credit will expire before the program is monetized in IL.
But the good news of the credit remains, any one who hasn't owned a home in the last three years can qualify to get a tax credit on a new home purchase. One point of clarification: The credit is good for 10% of home purchase prices up to $8000. It is not a flat $8000 credit. It means if you buy a home for $50,000, your credit will be 10 % or $5000. If you buy a $100,000 home, you credit will be for the $8000 max.
One other piece of good news to go with that. The IRS has worked it out so we don't have to wait until we file this years taxes next Feb, to get the credit. You can file a 1040X and get your refund in about 12 weeks after closing. You can get additional details at IRS.gov, or by calling your tax preparer. I am also available for other general questions, but I am not a tax pro, so I will still refer you to them for the accounting questions.
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