Tax Question Central
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Question: New Legislation for

Purchases of Foreclosures

I have heard that a bill is pending that will allow a $7,000 tax credit (to be taken over a two year period) for purchasing a foreclosed home. Can you tell me when this is to become effective (for homes purchased during what time period) and if it will also be applicable to investors purchasing homes as rental property. The home next door to me is in foreclosure and I would like to purchase it as a rental unit.

-- Xavier in Michigan

Answer:

Sorry, but things are really in flux around this legislation. The House and Senate and the White House are far apart and it is impossible to know what the final bill will look like, let along when it will be effective, if enacted. Things may become clearer in the next week or two.

-- Kevin McCormally

It's tax time, which means it's also time for NBR's special series -- "Tax Tips with Kevin McCormally." Once again, Kevin McCormally -- a noted personal finance expert and the Editorial Director of Kiplinger's Personal Finance -- tells you how to use the tax law to keep more of your money out of the IRS' hands.

Kevin's tips will air Mondays in March and throughout the week of April 7th. Review the tips below. Explore the Q&A section to ask Kevin your own tax questions and to read his answers.