Read the big thread on this page about it. Bear in mind only the Senate bill has this credit in the stimulus package. The House bill still has the 7500 limitation, though it was made a true credit and not a loan in the House bill. Odds are, since it has bipartisan support, that the Senate bill's version will be close to the final one - however, it could very well be tweaked a bit during the reconciliation process that will be going on this week to bring the House and the Senate bills into agreement.
Currently, this is a summary of the Senate bill's housing credit:
Applies to any principal home bought AFTER the bill's enactment, for one year from date of enactment (this was changed from being retroactive to apply to any home bought as a principal residence this year as originally written). To claim the credit, the owner must occupy the house for at least 2 years as their primary residence. If you sell or move before that 2 year period, the amount of tax credit claimed becomes due and payable on that years tax return (i.e. you buy a house, get 15K this year. Next year you move out. Your taxes for the 2010 year just jumped by 15K).
Does not require the buyer to be a first time buyer.
Provides up to 10% of the purchase price of the house, with a maximum of 15K as a tax credit to be taken either in one lump sum, or paid out over 2 years - this is a true tax credit, not a refundable one, so you will not be able to take the full amount unless you have at least $7500 in owed taxes each of the two years, or 15K in federal taxes in one year.
Allows for the purchase of the house, regardless of the actual date of closing, to be treated as if it were bought on Dec 31, 2008, for the purposes of claiming the credit (so if you buy a house in July of this year, you could file an amendment to your taxes for 2008, and get the claimed amount back as soon as the IRS processes it.)
Sunsets the $7500 refundable tax credit (which was really a 15 yr interest free loan) on the date of the enactment.
