$15,000 Home Buyer Tax Credit?

IMPORTANT: This article applies to a tax credit in 2009 and 2010 that has now expired. Use this information for historical purposes only. The information here does NOT apply to current tax years.

The $8,000 first-time home buyer tax credit program has been such a success, Washington is asking: Can we live without it? That credit is set to expire on December 1, 2009, but Sen. Johnny Isakson, (R-Ga.), has introduced legislation that would provide a $15,000 home buyer tax credit to any home buyer (not just first timers) who occupy the home they purchase for at least two years. Are you a prospective first-time home buyer? Here’s your gamble: Act quickly to take advantage of the $8,000 tax credit before it expires, or wait to see if the $15,000 home buyer tax credit becomes law.

Isakson’s proposed legislation would make available up to a $15,000 tax credit for any home buyer of any home over the next year. It would also remove the income limits that currently apply to the first-time home buyer tax credit. In a press release on the Senator’s Website, he says:

“If we do this, home values will return, unemployment will go down, our economy will turn, and consumer price confidence will go up. I would submit it is a part of the main solution we need to take an economy that is on the bottom and move it back toward equilibrium and prosperity for America.”

Another bill recently introduced would extend the $8,000 first-time home buyer tax credit for another six months. If this bill passes, first-time home buyers would have more time to claim the existing credit, although the rules would remain the same. (The tax credit would only apply to first-time home buyers and income caps would remain in place).

I predict that the first-time home buyer tax credit will be extended but Congress debates expanding the program to a $15,000 home buyer tax credit for a long time. If the expansion passes, I would bet it will include limitations (or even be for less than $15,000). What do you think? Is expanding the credit a good idea, or has the first-time home buyer tax credit run its course?

PS: If you’re looking for answers on the existing tax credit, visit my FAQ on the first-time home buyer tax credit or brief guide on how to buy your first home.

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


  1. My husband and I bought a house in 2006 six months after Katrina in an area that was not flooded. We unfortunately paid a lot for our house, but had no choice as the apartments in the area were going up as well. Because of when we bought it we never got any first home buyer incentives. My husband and I have been relocated with his job to another state. Our house in Louisiana is still on the market and we are in an apartment right now. We are ready to get a house and start a family, but can’t sell our other house. I wish we could get some kind of house tax credit. Now because of the market we are going to have to just rent our house in Louisiana until the market goes back up. This is all so frustrating!

  2. $15,000?! I don’t think they should seriously consider raising it from $8,000. The program is working well as is and should be extended out. Say we raise it to $15,000, then what? This isn’t addressing the root of the problem and if we open it to everyone, we will just go deeper in the debt as a nation. I personally bought a home in 2008 and will have to repay the $7,500 tax credit/loan. I’m just fine with that, it was a great deal. It helped me personally recoup some expenses from the purchase and helped me pay back all my credit card debt off. The government will eventually get that tax credit/loan back which they can use to fund government programs/services.

  3. Sure. Just don’t let Nevada, California, or Florida in on the action. They are the states with the most responsibility for the home price depreciation.

  4. I have mixed feelings about the credit. My husband and I have been trying to buy a house since May of this year. We were encouraged in part by the tax credit to begin the house hunting process. We’ve put in nine offers and none of them have been accepted. Every house has had multiple bidders sometimes as many as 30. I want the tax credit but at the same time it has made it nearly impossible to buy a house. We’ve outgrown our home and need to move to a larger one but we’re stuck in part due to the stimulus of the tax credit. If it meant that I could find a house tomorrow and have an offer accepted, I would say do away with it.

  5. If we extend the $8,000 or start a $15,000 credit, maybe they could change the $7,500 credit to make it so I do not have to pay it back.


    Seems like a drop in the bucket now.

  6. Extending this much longer will lead to price inflation in the same way that lax loan standards lead to price inflation.

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