The newly signed American Recovery and Reinvestment Act of 2009 provides an additional benefit – an $8,000 tax credit – to help first-time homebuyers purchase a home in 2009. If the home costs less than $80,000, the credit will be 10% of the purchase price. This incentive functions as a direct credit against the family’s federal taxes, and if the buyer owes less than $8,000 in federal taxes, any unused credit will be refunded. The credit does not have to be repaid, provided the buyer stays in the home for three years. The credit is reduced or eliminated for higher-income buyers. Individuals filing Form 1040 as Single (or Head of Household) are eligible for the credit if their income is no more than $95,000. Married couples who file a Joint return may have income of no more than $170,000. There is a "phaseout" bracket for individuals earning between $75,000 and $95,000 and for joint filers earning between $150,000 and $170,000. The home must be purchased between Jan. 1 and Nov. 30, 2009.
This new tax credit can be combined with assistance from an employer. With numerous employers in Illinois and around the country providing a housing benefit to their employees, this new credit deepens the impact of that assistance.
Even with the current economy and weak housing market, in 2008, employees continued to buy homes with their employers’ assistance. Johns Hopkins University and Johns Hopkins Health System rolled out a revamped and expanded EAH program in August, which has already helped more than 23 employees with new home purchases in targeted neighborhoods. Johns Hopkins contributed up to $16,000 in down payment assistance, which leveraged resources from the City of Baltimore and the State of Maryland. In addition, more than 30 employees have expressed interest in using this assistance to buy homes in the new East Baltimore Development, a public-private partnership to redevelop the disinvested East Baltimore area into a vibrant mixed-income, mixed-use community.
For more information about employer-assisted housing, visit www.reachillinois.org . More employer-assisted housing inititiatives are profiled in Understanding Employer-Assisted Housing: A Guidebook for Employers
We can help you design or fine-tune an employer-assisted housing initiative.