The $6,500 Tax Credit

by AnitaJay
(Seattle, WA)

Much has been said (and touted by real estate agents) about the $8,000 tax credit for first time buyers of houses, but I have read very little about the $6,500 tax credit that's supposedly available for existing homeowners.

Is this true? How does it work? Who is eligible?

Does buying a house and applying for this tax credit have any effect on the capital gain exemption for selling a house, or is that even a factor?

Thanks for your help!