There has been a ridiculous amount of material written about the (up to) $8,000 tax credit for first time home buyers. I’m guilty as charged (here are links to my 16 previous posts on the 8K tax credit).

The current incarnation of the tax credit ends on December 1. You must close on a home by November 30 to qualify for the tax credit. Given that today is October 24, if you aren’t under contract to buy a home right now, there is virtually zero chance you’ll qualify for the tax credit as it currently stands.

Lawmakers are scrambling at this very moment to extend or possibly expand the existing legislation. Here is a summary of some of that activity:

• UPI is reporting that Senator Johnny Isakson, who has lead the charge for a home buyer tax credit in the Senate since Day 1 has reached a point of compromise. Isakson has always wanted to see the tax credit at $15K, not limited to first time buyers, and the income limits increased. According to UPI, Isakson will introduce an amendment for a six month extension rather than 12 month and keep the credit at $8,000. He will still try to expand it to all primary residence buyers and raise the income limit to $150K for an individual or $300K for a couple.
• The Wall Street Journal reports that Isakson is “cautiously optimistic” that an extension – with procedural safeguards attached to stem the ever-growing tide of fraudulent credit claims – can move ahead in the Senate next week.
• CNBC is reporting that Senate Majority Leader Harry Reid is making a counter-proposal to Isakson’s tax credit extension that will phase out through 2010:
  

  Under Reid’s plan, the $8,000 tax credit would be phased out over time, dropping to $6,000 in April, $4,000 in July, and $2,000 in October, before expiring at the end of 2010. The plan could come to a vote as early as next week.

Opinions are mixed about whether the tax credit should be extended. As I’ve said several times here, buying a home just to get an $8K credit is not a good idea. That 8K will be long gone before your commitment to buying is complete. There are many good reasons to buy a home, but if the tax credit is your primary reason, or if the only way you can get into a home is with that money, then (in my opinion) you’re making a mistake.

It looks like next week is going to be an interesting one on the legislative front with regard to the impending end of the homer buyer tax credit. We’ll keep a close eye on things and report back what we hear!