Important Issues in the Budget for Real Estate!
There are some great newsworthy issues in the Budget that directly impact Real Estate:
1. The basic personal tax credit will increase for the 2009 tax year to $10,320 from $9,600 in 2008. Further, the upper limits of the first two income tax brackets will increase by 7.5% each. The upper limit of the first income tax bracket will increase to $40,476 in 2009 from $37,885 in 2008. The upper limit of the second income tax bracket will increase to $81,452 from $75,769. Savings for an individual with income in excess of $82,000 will be $284.
2. The government introduces a Home Renovation Tax Credit for renovations to a principal residence. This is a 15% non-refundable tax credit for home renovations greater than $1,000 and less than $10,000 for a maximum tax credit of $1,350.
3. First-time home buyers will be eligible for a First-Time Home Buyer’s Tax Credit for qualifying home purchases after January 27, 2009. The tax credit is a non-refundable tax credit available to first-time home buyers who purchase a qualifying home. Total savings will be a maximum of $750. Home purchases by a taxpayer who is eligible for a disability tax credit may also be eligible for this tax credit.
4. The amount a taxpayer can withdraw from his/her RRSP as a first-time home buyer will increase to $25,000 from $20,000 for withdrawals made after January 27, 2009 under the Home Buyer’s Plan.
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