First time homebuyer tax credit info

[ocnative]

I will reserve my opinion on this and post it for those who may be debating buying this year:

Low Down on the $8,000 First-Time Homebuyer Tax Credit

If you’re still on the fence about acquiring a home, then Uncle Sam has just thrown an extra incentive for those of you that’s still debating on waiting further or buying — a nice fat, $8,000 incentive (it’s not $15,000 but you take what you can get, eh?).

Since they’ve been throwing around a bunch of different numbers and qualification scenarios, here’s the fairly-certain low down on the new home buyer tax credit.

To Qualify for the $8,000 “First-Time” Homebuyer Tax Credit:

• Home purchase must be made between January 1, 2009 and November 30, 2009.
• Must be a “first time buyer.” In order to qualify for this status, you must not have owned a home for the past three years.
• You must also live in the purchased house for at least three years, or you’ll be obligated to pay back the tax credit.
• Homebuyers must make less than $75,000 for single tax filers, or $150,000 for couples.
• Higher-income buyers will receive a partial tax credit, but details have not yet been fully released.
• Single family residence purchases (condominiums, townhouses, co-ops) that will be used as a principal residence will qualify.

How to Claim the Homebuyer Tax Credit:

• Simply claim it on your tax return.  You will not have to filed any other forms or papers.  If you’re not a procrastinator like me and you’ve already filed your taxes, you can simply file an amended return for 2008 to claim the credit.
• What type of tax credit is it? It’s one of the better type: a refundable one.  This means that if you don’t owe any taxes, you will get any excess credit in the form of a fat refund check.  Example: If you owe $1,000 in taxes, you’ll get a $7,000 refund check.  If you’ve overpaid $1,000 in taxes, then you’ll get a $9,000 check. You can read more about refundable tax credit in the resource link below.
• If you’ve already claimed last year’s $7,500 tax credit, then you won’t be able to claim the $8,000 credit on next year’s return. It’s one credit or the other, buddy.
• Unlike the previous $7,500 tax credit, there’s no repayment required for this $8,000 tax credit!  (Unless of course you sold your house within three years, as stated earlier).

Other Miscellaneous Notes:

• If you’re buying into a retirement community, unfortunately, the purchase won’t qualify for the $8,000 first-time homebuyer tax credit.

This post will be updated as the IRS release further details upon their interpretation of the just-passed American Recovery and Reinvestment Act.

Regardless if you think the first-time homebuyer tax credit in the stimulus bill is a smart move or that it’s entirely bullsh*t  — the tax credit will certainly be a nice bonus for those that are looking to purchase a home in 2009.
 

Comments

[chapstickqueen.livejournal.com]

So now Eric not only wants to move to Portland ASAP this year, he wants to BUY a place there ASAP. Oy.

[chickenboo42.livejournal.com]

Seriously.

This sorta just makes me sad cause we're going to miss out by like, a year, probably. There's no way we're going to make it anywhere in the next year.

UGH. WANT.

[ocnative.livejournal.com]

Actually the traditional first time / first year homeowner credit is very nice. I'm not entirely sure how much different this one is.

[ocnative.livejournal.com]

Too funny! But you're the one bringing home the bacon, ha ha!

[syven.livejournal.com]

I worked (and was taught by the IRS) as team leader for the tax center on post in Germany 3 years ago. There was a very large tax break for first time home owners then and I've seen it on the Turbo Tax questions in the same vein in the years since. I wish I could remember the exact numbers but they were easily comparable to what you have here.

[ocnative.livejournal.com]

Yeah I can't remember what mine was, but I remember being VERY happy my first year as a homeowner!

Do you happen to know if this would apply if my husband and I bought a place and he would be a first time homebuyer? I own our condo, but he has never owned a home. I don't see that question answered in the places I've looked.

[pixie117.livejournal.com]

I really would like to buy a home once I accept a job (hopefully back in MO), but not sure we qualify. While I have never bought a home, James owns a duplex (we technically bought it together, but only his name was on the mortgage and deed, I forget why we did it though).

[ocnative.livejournal.com]

Yeah I am in the same boat. I own our place, but Chris has never owned anything. I wonder if he went first, if that would count...?

Not that we are in a position to buy...