What Is Popular Is Not Always Right…Like the Homebuyer Tax Credit
The New York Times’ Jackie Calmes reports that a high-profile part of the stimulus bill — the $8,000 tax-credit to first-time homebuyers — has not been rigorously audited by the IRS. Calmes gets her info from a Treasury Dept. Inspector General report that features some embarrassing facts — like that a four year-old claimed a homebuyer tax credit. But the more systemic problem is that 60 percent of the 1.4 million people who claimed the tax credit have incomes below $50,000. This suggests that the tax credit might be doing exactly what the housing bubble did — encouraging people to buy a home who realistically can’t make the mortgage payments. (more…)
