First Time Homebuyer Tax Credit
HOUSING AND ECONOMIC RECOVERY ACT OF 2008
$8,000 First Time Home Buyers Tax Credit
Expires, April 30, 2010. The purchase
offer must be accepted by April 30 and
must be closed by June 30, 2010
to qualify for the tax credit.
The $8,000 credit is available for first
time home buyers and a $6,500 credit is
available for present homeowners
purchasing another primary residence
if they have owned a home for five of
the last ten years. :
There are income limitations:
•If an individual makes $125,000 or higher, they will not be eligible.
•If a couple's joint income is $225,000 or higher, they will not be eligible.
The credit must be repaid if the homeowner sells the home in less than 36 months or if the home ceases to be his principal residence during that time.
Forms and instructions for claiming the credit on 2010 tax returns are available at http://www.irs.gov. The form number is 5405.
H.R. 3221
Housing and Economic Recovery Act of 2008
Ten percent of cost of home, not to exceed $7,500
Any single family residence (including condos, co-ops)
that will be used as a principal residence.
Yes. Reduces income tax liability for the year of
purchase. Claimed on tax return for that tax year.
Yes. Full amount of credit available for individuals
with adjusted gross income of no more than $75,000
($150,000 on a joint return). Phases out above
those caps ($95,000 and $170,000, respectively).
Yes. Purchaser (and purchaser’s spouse) may not
have owned a principal residence in 3 years previous
to purchase.
Yes. Portion (6.67 % of credit) to be repaid each
year for 15 years. If home sold before 15 years, then
remainder of credit recaptured on sale.
Purchases on or after April 9, 2008
July 1, 2009
Can be used against AMT, so credit will not throw
individual into AMT.
Law
Amount of Credit
Eligible Property
Refundable
Income Limit
First time Homebuyer Only
Recapture
Effective Date
Termination
Interaction with Alternative Minimum Tax
American Recovery and Reinvestment Act of 2009
a.k.a. The Stimulus Act..
$8,000 First Time Home Buyers Tax Credit
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