Go on take the money and run?

ian1977 — Mon, 18 Aug 2008 18:51:52 -0800

Use the new Federal Housing Tax Credit as an investment seed? Is there anything fundamentally wrong with this idea?:

Take the new Federal Housing Tax Credit and dump the $7500 into a Roth IRA. Repay the 'credit' at the normal rate (~$500/year for ~15 years I think).

This seems like a no brainer to me, but I am not very financially savvy. Its essentially a no-interest loan, so it I would think that investing no-interest money is a win-win, but then again, I'm dense enough that I once thought I had a system to beat a casino's video roulette machine. (long story short, I emphatically did not)

Thoughts? Is there a better way to optimize the 'credit'? Is it best to leave it alone?

Bonus points for finance/investment gurus: Assuming moderate gains (8%???), how much ahead am I by being able to invest the $7500 up front, versus the alternate scenario of investing $500/year for 15 years.

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Go on take the money and run?