Kona Kohala Blog

One last pitch for the First Time Homebuyer's Credit, it expires on November 30, 2009 meaning you must have closed on the property by that date in order to be qualified to receive either 10% of the purchase price of $8,000 whichever is less.

This is a "refundable tax credit".  First, what's the difference between a tax credit and a tax deduction?  A credit is a one for one credit against taxes due.  A deduction is an amount deducted from your gross income when determining your taxes owed.

A refundable credit means that if you owe $6,000 when filing your taxes you could apply the $8,000 tax credit so the government now owes you $2,000.  One of the requirements is that you must file your federal income tax in order to initiate the tax credit.

There are some other requirements and limitations on the program so if you have questions, please go to our First Timers page or, email me, Robert@FerrariPacificRealty.com or call 808-896-0661.  There's a chance this program will be extended, possibly even apply to all home buyers, not just first timers, and it may be increased.

Opponents of the program point to the cost.  It was expected to cost $7.5B, yes billion but actually cost $15B to date.  Since it seems to be just a matter of printing more money for this administration, nothing is out of the question.