As for the previous poster, I sympathize with your loss and would guess that you are thankful that unemployment benefits have been extended for a year. Imagine if you had been one of the unlucky folks who lost their job during a previous recession, you would have been capped at a measly 6 months.

See, there is always a bright side…

Sean, you’re taking the analogy in the wrong direction. You only get the government handout when you make a purchase. What’s happening is much closer to this: the TV costs $307,500 and then 30 days later it costs $300,000.

If that happened, no one would even blink. You couldn’t attract journalists to that story even with free food. Housing is just a more emotional issue in general.

Well, I’d still be frustrated – no way around that. On the other hand, it would still be past the 30 day price match guarantee nearly every store has these days; not much I could do other than chalk it up to the reality of the retail environment. I suppose you could return it and buy another as some folks do, but that’s not the most ethical way around things. Nor can most of us return our houses…

Ultimately, my point is still simply that anyone who got a credit (be it the $7500 or $8000) knowingly entered into an agreement at the time the bought their house. Nobody was forced to take the money. You win some, you lose some, and you have the right to be frustrated – but none of that makes it the government’s job to change the deal on an old program to make people feel better.

Would I be frustrated if I had to pay money back while others didn’t? Well sure, just as I’d be frustrated if I bought a big new TV for $1200 and 31 days later the same store had it for $750. But that’s the reality – you knowingly entered into an agreement and took advantage of money that was available when you bought a house. So stop complaining – please!

(For example, California is offering an additional $10,000 to homebuyers, but only to homebuyers who buy newly constructed homes. You don’t have to be the taxpayer to get affected by that one.)

Regarding tax dollars, broadly, all gov. spending comes from tax dollars, current, future, and implicit, where I include the so-called inflation tax, which is a result of deficits (averaged over long time periods; and since treasuries are like money in effect, etc. etc.). So since this is government spending, we ought to say how we think it should be spent.

Broader language would be perhaps “your and my money being spent”. Maybe we need to start saying something like “government spending is spending your and my money” or something like that. Can you think of a better phrase?

My point was simply that if the govt offers me a $7500 loan to buy a house, and I accept that loan, then both sides implicitly agree it’s fair. That isn’t altered just because a different deal happens between other people at other times. Different people have different priorities; if they didn’t, markets wouldn’t function.

By the way, we also disagree on the relationship between taxation and representative democracy, but what’s important is that this is *not* a decision about how to handle your and my tax dollars. These grants aren’t paid with tax proceeds. They’re paid with money the U.S. doesn’t have and isn’t borrowing — i.e., they’re inflating the economy by creating dollars. This reduces the buying power of all existing dollars. Yes, it’s still technically a “tax”, a tax on each dollar you currently hold, but it’s not subject to any kind of predictable tax code or any tax policy you might be referring to.

We are talking about public policy, literally how to handle your and my tax dollars, so as taxpayers we have a right to say what we think should be done, and how and why, etc.

I say that if my tax dollars support a $8000 grant to first time home buyers during 2009, that I also think the “credit” to first time home buyers in 2008 should be at least a partial grant, in order to even the playing field. A similar rule I think should be in place is for the 2009 grant to be stepped down over time, say $6000 in 2010, $4000 in 2011, $2000 in 2012, so as to reduce economic distortions.

I’d welcome specific, well-reasoned alternatives.

There’s nothing unfair about offering homebuyers a deal and then fulfilling the deal with the homebuyers who agree to it. If you entered into that transaction willingly, then it was a good deal for you, a net gain, right? Did your gain somehow become a loss just because the govt made a different deal with someone else?

Here’s why:

If you simply put the money in a savings account, money market, or part of it in a CD, etc., you can earn some interest.

Alternatively, you can pay off credit card debt (and then DO NOT RUN UP YOUR CREDIT CARD AGAIN AFTER).

Then you have a lower interest rate, and an easy repayment (but not a flexible one) of only $500/year.

This can save a lot of interest costs.

STill, the most fair would be for part or all of this credit to be a true real credit (with only 1/2 or even $0 owed as repayment).

For instance, to reduce the repayment requirement for 2008 purchases to 1/2 ($250 a year for 15 years, instead of $500/year).

Any news on the final outcome. I haven’t been able to find this easily at all, after several searches.

Arguably this credit *is* to lure in people who can’t afford it. We’ve noted here already that some folks will use an $8000 credit toward a down payment and thus actually buy an extra $40,000 worth of house. So they’ll go deeper into debt. This tax credit *increases* consumer debt, even if hypothetical well-meaning legislators don’t know it.

As for your credit you may want to look a bit further. The credit begins to phase out for incomes over $150,000 per year but does not disappear. So if your income exceeds $150,000 you may still be eligible for a reduced credit.

The definition of 1st time buyer that is being used is one that has not owned a home in the previous three year period. So you mentioned that is has been two years since you owned and if you will hit that three year point at anytime before 12-1-09 then you are eligible. By the way the credit is $8000 now.

Cheers.

that is what I have read in numerous postings. The “NEW” credit is NOT refundable. The “OLD” one was. I qualified for the old credit and i filed my return earlier this week. I am getting nearly a $9000 refund whereas I would have only received a $1500 refund w/o the credit. It’s my money to begin with so…..yippee for me.

I read through the legislation and I find this stuff VERY difficult to comprehend, but the following quote is leading me to believe that this is a NON-refundable credit unlike the previous $7500 credit initiated last summer.

LIMITATION BASED ON AMOUNT OF
4 TAX.—In the case of a taxable year to which section
5 26(a)(2) does not apply, the credit allowed under
6 subsection (a) for any taxable year shall not exceed
7 the excess of—
8 ‘‘(A) the sum of the regular tax liability
9 (as defined in section 26(b)) plus the tax
imposed by section 55, over
11 ‘‘(B) the sum of the credits allowable
12 under this subpart (other than this section) for
13 the taxable year.

Can anyone translate this?!?!?!

Once they decided to make it retroactive to 2008, they should have done it all the way back to January 1. What is the sense of April 9th? Now we get to see the section on our 2008 tax return for the First Time Homebuyers credit, but we get nothing. Never seen or heard of a tax credit that only applies towards purchases for a certain part of the year.

Want a tax break? Put solar panels on your house in January, have twins in March, expand your home office in July, take a business trip to Calcutta in November. It won’t matter when, as long as it was 2008. Oh, you bought a house for the 1st time? Hope it was after April 9th.

Write your congressman, maybe it’ll help. I wrote my representative and both senators, and the president. I wrote letters to the editors of all the newspapers around here. If you are getting the shaft, you should do the same.

Thanks