Businesses and Individuals seem to really be on top of putting their 2008 tax information together earlier than usual this year.  People are anxious to know where they stand financially and what they need to looking at for options.  The major questions center around the viability of holding real estate investments and small businesses.  I have been quite impressed about the attitudes of my clients.  Most of them are stressed, naturally, but they are not sitting around whining.  They realize they need to adjust to major changes and simply want some input about their options.

This weeks Blog centers around the logic of Congress pushing for a $15,000 tax credit for Buyers of primary residences.  In some versions, it refers to first time Homebuyers (i.e. haven't owned a primary residence in that past two years - not exactly "first time") and others simply any purchase of a primary residence.  This would be a "free and clear" tax credit.  Last year the $7500.00 credit would have to be paid back over 15 years. There willl limits on the price of the home purchase - I believe they are looking at the $150,000 and below for the full credit.  The problem I have with this is that people who buy in that price ranges don't have $15,000 in taxes.  Is it going to be a refundable credit?  That seems like a huge tax bill for the rest of us that cannot participate in that program??  Also, it will not help them get financing.   It is not availalble for a down payment or to pay down current debt so people can qualify for a loan to start with.  I feel that is where the emphasis should be.  These type of funds should go first to those who owe more than their home is worth so they can restructure their loan under current interest rates and at a lower amount of principle owed. Then they should assist with down payments for those qualifiied for affordable housing.

 What do you think?

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