Tax Prep by Deb Posted February 25, 2009 Report Share Posted February 25, 2009 I have a client who purchased her first home in December of 2008. When I explained to her about the $7,500.00 credit and how hers will really only be the no interest loan, we discussed wether to take it or not. I explained that as of now it is a loan, but hopes are that maybe it would be changed to the same program, and perhaps not have to pay it back. If it remains a loan she really doesn't want to take the credit because she really doesn't need the money. On the other hand if there is a possiblity of the law being changed she would hate to lose out on it by not taking the loan. My question is if she chooses not to take the credit, then the law is changed would she be able to ammend and claim the credit then? Any thoughts! Deb! Quote Link to comment Share on other sites More sharing options...
zeke Posted February 25, 2009 Report Share Posted February 25, 2009 >>My question is if she chooses not to take the credit, then the law is changed would she be able to ammend and claim the credit then?<< Thanks for the compliment Deb!! It would be great if I could foretell just how the congress will change the law. z Quote Link to comment Share on other sites More sharing options...
Gail in Virginia Posted February 25, 2009 Report Share Posted February 25, 2009 I seriously doubt that the law will be amended to change the way that credit works. I think if there were any feeling that should be done it would have been included in this last bill. I believe the change was to encourage more first time home buyers for the rest of this year in order to stimulate the economy. However, since my crystal ball is slightly cracked, I make no guarantees about what a bunch of politicians might decide in the future. Quote Link to comment Share on other sites More sharing options...
grandmabee Posted February 26, 2009 Report Share Posted February 26, 2009 take the credit put in a CD and wait and pay back each year. Will come out ahead.....unless she would spend on something else and not save money. Quote Link to comment Share on other sites More sharing options...
Daune/CA Posted February 26, 2009 Report Share Posted February 26, 2009 take the credit put in a CD and wait and pay back each year. Will come out ahead.....unless she would spend on something else and not save money. This appears to be a good advice, since we can not tell what congress will do in the future. (At least she would receive the interest earned on it) But their history shows that more times than not they have amended to make retro or made it even better. Look at the "one time exclusion" that was on the books for many years, and now you can exclude many times over. Get a group of folks together to send emails or letters to their congress rep to eliminate the payback! Pressure makes them take action! A lot can happen in 15 years. Quote Link to comment Share on other sites More sharing options...
Tax Prep by Deb Posted February 26, 2009 Author Report Share Posted February 26, 2009 take the credit put in a CD and wait and pay back each year. Will come out ahead.....unless she would spend on something else and not save money. That is exactly what I suggested to her and she has decided to do just that. At least this way she can get some benefit of the provision. Deb! Quote Link to comment Share on other sites More sharing options...
Lion EA Posted February 26, 2009 Report Share Posted February 26, 2009 Take the loan and pay down her principal. Show her how much she'll save. Then, raise her fee! Quote Link to comment Share on other sites More sharing options...
Tax Prep by Deb Posted February 26, 2009 Author Report Share Posted February 26, 2009 Take the loan and pay down her principal. Show her how much she'll save. Then, raise her fee! COOL! That never even came across my mind! She would definitely be making the money work for her as paying down principle, therefore decreasing interest charged would earn her a greater return than just sticking the money in the bank. I truly do appreciate that thought! Thanks, Deb! Quote Link to comment Share on other sites More sharing options...
Lion EA Posted February 28, 2009 Report Share Posted February 28, 2009 Obviously, if she has some high interest rate debt, she should pay that down first. But, otherwise, putting $7,500 against the principal of a 30-year loan will make a nice difference in the true cost of her home. Quote Link to comment Share on other sites More sharing options...
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