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$8,000 Tax Credit - how to get yours

Available for first-time home buyers only, and you don

February 17th, 2009

The House and the Senate passed the American Recovery and Reinvestment Act of 2009 which includes an $8,000 tax credit available for first time home-buyers!

Highlights of the $8,000 Tax Credit Include:

Available only to first-time home buyers
Available only between Jan 1, 2009 - Dec 1, 2009
Does not require repayment
Is claimed on a tax return and reduces your tax liability. If your credit is more than your tax liability, your unused credit will be issued as a check to you

Who is Eligible
The law defines a first-time home buyer as a buyer who has not owned a home during the past three years. All U.S. citizens who file taxes are eligible to participate in the program.

Income Limits
Home buyers who file as single or head-of-household taxpayers can claim the full $8,000 credit if their modified adjusted gross income (MAGI) is less than $75,000. For married couples filing a joint return, the income limit doubles to $150,000.

Effective Dates for the Tax Credit
First-time home buyers would receive a $8,000 tax credit for the purchase of any home on or after January 1, 2009 and before December 1, 2009. To qualify, you must actually close on the sale of the home during this period.

Tax Credit is Refundable
A refundable credit means that if you pay less than $8,000 in federal income taxes, then the government will write you a check for the difference. For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $3,000 payment from the government. If you are due to receive a $1,000 tax refund from the government, your refund would grow to $9,500 ($1,000 plus $8,000 from the home buyer tax credit). Buyers can take the tax credit in their 2008 or 2009 tax return.

Types of Homes that Qualify for the Tax Credit
All homes, whether single-family, townhomes or condominium apartments will qualify, provided that the home will be used as a principal residence and the buyer has not owned a home in the prior three years. This also includes newly-constructed homes.

For more details on the tax credit, go to www.federalhousingtaxcredit.com