The Federal Government has extended and expanded the tax credit for home buyers. Here’s the scoop! For first time homebuyers (people who have not owned a home for at least three years) the tax credit is $8,000. A contract to buy must be entered into by April 30, 2010 and close on the home by June 30.

People who currently own a home and want to buy a replacement home may qualify for a $6,500 tax credit. They must have lived in that home for five consecutive years within the last eight years.

A tax credit is a dollar for dollar credit against taxes owed. So, an $8,000 tax credit reduces tax by $8,000. Check with your tax preparer but even if you don’t have $8,000 in tax to pay, the government may write you a check. Check out the video from IRS. Combine the tax credit with low home prices and low interest rates and now is a great time to become a homeowner. Act now! Don’t wait!