2009 Stimulus Plan

Posted by Faizan Shiwani / at 4:56 AM / /

When President Obama signed the bill for the $787 billion stimulus plan, many Americans were left wondering where that money would go and how it could help them. The $400-$800 tax credit for all tax payers was a nice start, but that isn’t all there was to the plan, was there? The good news is a lot of that money is also available in the form of additional tax credits for people who want to buy a new home or improve their current home.
The biggest tax credit available is for first time home buyers. If you purchase your first home, new or resale, on or after January 1, but before December 1 of 2009, you could be eligible for up to 10 percent of the homes purchase price up to $8,000. The best part is, this tax credit never needs to be repaid.
How can you know if you qualify for this? First, the tax credit is only available to first time home buyers. That means you’ve never owned a principle residence before, not counting rental properties or vacation homes. Second, the tax credit is only available in full for single people making $75,000 a year or less, or married couples filing a joint return of less than $150,000. There is also a “phaseout range” of $20,000 dollars, meaning that the benefits of the tax credit decrease gradually for people making up to $95,000, or $170,000 for couples. For example, a single person making $85,000 would be limited to only half of the tax credit, or a maximum of $4,000. To find out more, visit www.federalhousingtaxcredit.com.
If you aren’t in the market for a new home there are other ways to take advantage of the stimulus plan. One of these ways is known as the Weatherization Assistance Program. If you make 200 percent (twice as much) of the national poverty level or less, you could be eligible for up to $6,500 toward energy saving upgrades for your home. If you qualify for this program you can receive a professional consultation, tests to find ways to improve your homes efficiency, and money to pay for such upgrades as insulation, caulking, sealing for air leaks, and energy efficient heating and cooling systems.
The benefits of the plan don’t end there; there are even perks for those who make more than 200 percent of the national poverty level in the form of additional tax credits. If you don’t qualify for the Weatherization Assistance Program, you can apply for a tax credit for energy saving improvements that you add to your home. These tax credits can cover up to 30 percent or $1,500 of the cost of the same energy saving upgrades provided in the assistance program. These upgrades can contribute to a significantly lower energy bill, which in many cases will pay for themselves over time as well as helping the environment.
The economic crisis has taken its toll on all of us, but with the many options available through the stimulus plan, there may never be a better time to buy a new home or upgrade your current one. For more information, contact a financial professional to find out which tax credits you qualify for.