Kathy Knight - Welcome to the Beach

Apr 27

Written by:
4/27/2010 7:01 AM 

Home Buyer Credit

Qualifications for the $8,000 Home Buyer Tax Credit

Only first-time home buyers are eligible for the $8,000 tax credit. This is defined as not owning a home over the past 3 years. Here are other qualifications:

• The home must be your principal residence.
• Only homes purchased on or after January 1, 2009 and before June 30, 2010 qualify for the tax credit.
• Limited to individuals with adjusted gross incomes of $75,000 as a single person or $150,000 filing jointly for those who have closed by November 5, 2009. There is a phase-out for single incomes between $75,000 and $95,000, and for couples filing jointly with incomes between $150,000 and $170,000. For first-time home buyers who buy a home between November 6, 2009 and April 30, 2010, the extension signed by Obama raises the income levels to $125,000 as a single person or $225,000 for couples.

More About the $8,000 Home Buyer Tax Credit

• Unlike the 2008 $7,500 home buyer tax credit, the $8,000 first-time home buyer tax credit is not a loan and does not need to be repaid. It's like free money for buying a house during the specified time period and meeting certain requirements.
• Also, unlike the 2008 $7,500 home buyer tax credit, you can use the credit if you financed your home purchase with state or local bond funding.
• However, if you sell that home within the first 3 years of ownership, the entire amount of the tax credit is recaptured. This means you will be required to give that money back to the I.R.S. So, if you take advantage of the tax credit, plan to stay put for 3 years.

 

 

From Elizabeth Weintraub.