$15,000 Home Buyer Credit?

Most people agree that the $8,000 first-time home buyer tax credit program has been such a success.

It now has some people in Washington asking: Can we live without it? The program 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.

Sounds good, right? But if you are a prospective first-time home buyer here is your dilemma: Should you 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?

Sen. 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).

So what do you think will happen, or should happen? My guess is that the first-time home buyer tax credit will be extended. I also think Congress will debate expanding the program to a $15,000 home buyer tax credit, but don’t look for any quick resolution.

If the expansion passes, I think it will include limitations (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?