First Time Home Buyer Tax Credit has been a huge boon to the housing market. Estimates vary, but most agree that the credit has been claimed by about one million folks and that of that one million about 350,000 home sales would not have happened if the credit had not been in place.
However it now seems that IRS is wondering just how many of those receiving the credit were entitled and how many were cheating. With that in mind IRS is now reviewing 100,000 of the claims filled by buyers. Seems like someone finally figured out that maybe as there was little need to prove your qualifications a few of these claims might not be on the up and up. What a shock!
The South Bay hasn't had many folks receiving the credit because of home prices and the income restrictions...$75,000 for single folks and $150,000 for married people. However with talk of extending the credit and upping the income levels we could see more potential buyers qualifying.
The Real Estate Bloggers are finding the timing a tad suspicious. Is there a reason the government is sending out IRS just as it comes time to start paying out the credit? Wouldn't it have made more sense to have had tougher criteria in place in the first place rather then now spending a lot of money reviewing tax claims... Questions...questions...questions.
The word around town is that if you did file for the credit you best have all your paperwork together for at least the last three years and it needs to be pristine. If Congress does agree to extend the credit and revamp the income requirements upward then take heed if you plan to file for the credit. It's probably not a good idea to file for the credit along with a creative tax return.