The latest buzz in Real Estate today is talk about the Stimulus Bill signed by President Obama on February 17, 2009. If you are a first time home buyer you may be confused as to how this applies to you. According to the Stimulus Bill, a first time home buyer is described as anyone who has not owned a home for 3 years prior to a purchase.. There are certain criteria which you must meet to qualify for the tax credit. The following is a guideline which will help you determine if you qualify for the tax credit.
*You must be purchasing a home as your principal residence and not as a second home.
*First time home buyers can get a tax credit of 10% (up to $8,0000) of the purchase price of a home. (Example, if you purchase a home for $80,000 your tax credit will be $8,000).
*The tax credit can be claimed on your ’08 tax return if filed by April 15th, on an amended ‘08 tax return or your ‘09 tax return.
*If you sell your home within 3 years of the purchase the credit will be recaptured. .
*The tax credit can only be taken if your taxable income for the year is less than $75,000 for those filing a single return or $150,000 for those filing a joint return.
Unlike last years Housing Recovery Plan passed in August of 2008, first time home buyers will not have to repay any of the tax credit unless the home is sold within three years of the purchase. Individuals should consult a professional tax advisor for exact tax calculations and timing.
With rates being at all time lows and all the first time home buyer programs out there including the tax credit of up to $8,000 there has never been a better time to purchase your first home.
Details on the First Time Home Buyer Tax Credit.