(All sorts of disclaimers here… I’m not a tax advisor! You really do need to check with one—tax issues are never simple!)
There is a temporary credit available to first-time homebuyers for purchases from January 1, 2009 until December 1, 2009. The credit is equal to 10 percent of the cost of the home up to a maximum of $8,000.
Buyers can claim the credit on their federal tax return. If the credit exceeds their total tax liability, the buyer gets a refund check for the balance.
A first-time buyer is defined as an individual who has not owned a home in the past three years. For married joint filers, both must meet the test.
Eligible properties include anything that will be used as a principal single-family residence.
There are income guidelines. Individuals with an adjusted gross income up to $75,000 (or $150,000 if filing jointly) are eligible for the full credit. The credit is phased down for those earning more.
The 2009 credit does not have to be repaid if the buyer stays in three years. But if is sold before that, the entire amount of the credit is recaptured on the sale.
People who purchased homes under the 2008 $7500 tax credit program will still be required to repay that credit to the government over a 15 year period.
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