April 28, 2009
National Association of REALTORS explains $8,000 First time home buyers tax credit
I read the following article and thought it might be beneficial to anyone that wanted more info on the $8,000. First-time Home Buyers Tax Credit. I also wrote 7 questions and answers you might have about this tax credit which you can read here First Time Homebuyer Tax Credit Questions and Answers
Bringing the Dream of Homeownership Within Reach
copyright © National Association of REALTORS ®
As part of its plan to stimulate the U.S. housing market and address the economic challenges facing our nation, Congress has passed legislation that grants a tax credit of up to $8,000 to first-time home buyers.
Here is more information about how the 2009 First-Time Home Buyer Tax Credit can help prospective home buyers become part of the American dream.
Who Qualifies?
First-time home buyers who purchase homes between January 1, 2009 and December 1, 2009.
To qualify as a “first-time home buyer” the purchaser or his/her spouse may not have owned a residence during the three years prior to the purchase.
Which Properties Are Eligible?
The 2009 First-Time Home Buyer Tax Credit may be applied to primary residences, including: single-family homes, condos, townhomes, and co-ops.
How Much Will the Credit Be?
The maximum allowable credit for home buyers is $8,000. Each home buyer’s tax credit is determined by two factors:
The price of the home-the credit is equal to 10% of the purchase price of the home, up to $8,000.
The buyer’s income-single buyers with incomes up to $75,000 and married couples with incomes up to $150,000-may receive the maximum tax credit.
If the Buyer(s)’ Income Exceeds These Limits, Can He/She Still Get a Credit?
Yes, some buyers may still be eligible for the credit.
The credit decreases for buyers who earn between $75,000 and $95,000 for single buyers and between $150,000 and $170,000 for home buyers filing jointly. The amount of the tax credit decreases as his/her income approaches the maximum limit. Home buyers earning more than the maximum qualifying income-over $95,000 for singles and over $170,000 for couples are not eligible for the credit.
Will the Tax Credit Need to Be Repaid?
No. The buyer does not need to repay the tax credit, if he/she occupies the home for three years or more. However, if the property is sold during the three-year period, the credit will be recouped on the sale.
kathy mcgraw said,
April 28, 2009 @ 10:57 am
Most of my clients didn’t realize they were first time home buyers because they owned a home……keep it mind, if you haven’t bought within the last 3 years, you are a first time home buyer :)
California Real Estate and Life » Good News for Homeowners the $8000 Tax Credit can be used with FHA loans to offset costs said,
May 29, 2009 @ 11:42 am
[...] American Recovery and Reinvestment Act of 2009 (Recovery Act) provides for as much as an $8000 tax credit to qualified first-time home buyers. But now the rules have changed again, and FHA Lenders can [...]
Daniel Ramos said,
January 20, 2010 @ 12:16 pm
I purchased a home on nov 2009 with my Dad and myself on the tittle our income combined will be less than 50k. The purchase price was 220K on the property. Are we only getting the 10% aprox $2,200 or will we get the max 8K? In addtion how should we file the taxes? Combined to the the house credit or separate, for the fact that I’m independent and have my own child being a single dad. I want to get my child tax refund in addition to the home credit. I’m very confused any help would be greatly appreciated. Work is slow but we are still blessed to be able to make payment on house.
Daniel Ramos. California.
Kathy said,
January 20, 2010 @ 2:15 pm
Daniel- As a REALTOR I am not allowed to give tax advice, but let me check out some of your basic questions and I will get back to you. I will post my answer by tomorrow (have to make a few calls). They really are good questions.
kathy mcgraw said,
January 20, 2010 @ 10:35 pm
The tax credit is a maximum of $8000 for a married couple – or $4000 for a single person – and you are right it is 10% of the purchase price which is $22,000 not $2,200 – so your purchase price would take you to the maximum – because I cannot give tax advice or legal advice I would suggest you talk to your tax preparer and visit this website from the IRS for clear and precise answers to your question http://www.irs.gov/newsroom/article/0,,id=204671,00.html