Illinois Association of REALTORS(R) outline the conditions and benefits of the federal legislation SPRINGFIELD, Ill., Aug. 21
SPRINGFIELD, Ill., Aug. 21 /PRNewswire/ -- A one-time tax credit for
first-time homebuyers is part of a new federal housing stimulus law designed
to help new buyers jump into homeownership and stimulate the real estate
market across the country.
"The Illinois Association of REALTORS(R) believes this tax credit is an
extremely valuable tool for new homebuyers," said Pat Callan, president-elect
of the Illinois Association of REALTORS(R), during a teleconference today
about the tax credit. "While we all understand that we are in a challenging
real estate market, it's important to recognize there are compelling reasons
to buy, especially for first-time homebuyers in Illinois. We have low interest
rates, attractively-priced homes and plentiful housing stock."
According to Callan, broker-owner of Realty Executives Premiere in
Wheaton, there are several ways a first-time buyer can benefit from the tax
credit:
-- Homebuyers have the choice of either taking the money as a lump sum as
part of their 2008 or 2009 tax refund, or they can immediately adjust
their withholdings so they can take home additional money in each
paycheck (which could be saved to put towards a down payment);
-- The tax credit can reduce their tax liability at the end of the year;
-- The tax credit essentially provides a discount on the home purchase
price. For example, a buyer purchasing a home for $200,000 will in fact
only be paying $192,250 once this tax credit is applied;
-- And finally, it makes it possible for more people to increase their net
worth by becoming homebuyers.
Callan noted that many buyers are just learning of the tax credit and are
turning to their REALTORS(R) for information about how they can take advantage
of it.
"In the Belleville area, for example, I heard from a member who just had a
few buyers come off the fence because of the incentive, which is very
encouraging," said Callan. "And in Naperville, I heard from a member who's
been telling his first-time buyers about the credit. He said that some of his
clients are excited about it simply because the financial perk will allow them
to buy a few pieces of furniture for their new home."
The first-time homebuyer tax credit is part of the Housing and Economic
Recovery Act signed into law by President Bush on July 30. The tax credit is
available for home purchases made between April 9, 2008, and June 30, 2009.
The credit is only available to buyers who haven't owned a home in the
last three years, or who have never made a home purchase at all. Buyers with
an income of up to $75,000 are eligible for the full credit, and the incentive
phases down for those earning more, up to $95,000, at which point the person
is no longer eligible for the tax credit.
The tax credit incentive can be viewed as a refundable credit because it
must be paid back over a 15-year period in equal sums; however, there are no
interest charges on the outstanding balance.
For more information about the homebuyer tax credit, visit IAR's Web site
at http://www.illinoisrealtor.org; the National Association of REALTOR(R)'s
Web site at http://www.realtor.org; the IRS at http://www.irs.gov for a W-4
worksheet and other tax information; or contact your local REALTOR(R).
The Illinois Association of REALTORS(R) is a voluntary trade association
whose 55,000 members are engaged in all facets of the real estate industry. In
addition to serving the professional needs of its members, the Illinois
Association of REALTORS(R) works to protect the rights of private property
owners in the state by recommending and promoting legislation that safeguards
and advances the rights of real property ownership.
SOURCE Illinois Association of REALTORS
