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Natalie Russell
(404) 291-6993- Direct
If you or anyone you
know is interested in buying, selling, renting, or leasing please contact
Natalie.
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$8,000 Tax Credit
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Who is eligible to claim
the $8,000 tax credit?
First-time home buyers purchasing any kind of home—new or resale—are
eligible for the tax credit. To qualify for the tax credit, a home
purchase must occur on or after January 1, 2009 and on or before
April 30, 2010. For the purposes of the tax credit, the purchase
date is the date when closing occurs and the title to the property
transfers to the home owner. A limited exception exists for certain
contract for deed purchases and installment sale purchases.
See the IRS website for more detail.
However, the law also allows home sales occurring by June 30, 2010
to qualify, provided they are due to a binding sales contract in
force on or before April 30, 2010.
Persons who are claimed as dependents by other taxpayers or who are
under age 18 are not qualified for the tax credit program.
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$8000 First-Time Homebuyer Tax Credit FAQ
When do I need to purchase to
qualify?
If you buy a home between Jan. 1 2009 and April 30, 2010 and close escrow
during these dates, you will qualify for an $8,000 tax credit - as long
as it is your primary residence and you meet the simple requirements.
Are there any
income limits for claiming the tax credit?
Yes. For sales occurring after November 6, 2009,
the income limit for single taxpayers is $125,000; the limit is $225,000
for married taxpayers filing a joint return. The tax credit amount is
reduced for buyers with a modified adjusted gross income (MAGI) of more
than $125,000 for single taxpayers and $225,000 for married taxpayers
filing a joint return. The phase-out range for the tax credit program is
equal to $20,000. That is, the tax credit amount is reduced to zero for
taxpayers with MAGI of more than $145,000 (single) or $245,000 (married)
and is reduced proportionally for taxpayers with MAGIs between these
amounts.
How does the law define
"first-time homebuyer"?
The law defines "first-time homebuyer" as a buyer who has not owned a
principal residence during the three-year period prior to the purchase.
How do I apply for the credit?
Taxpayers should use IRS Tax Form 5405 to claim the first-time homebuyer
tax credit.
Does the credit have to be
repaid?
No. Unlike a similar tax credit passed in 2008, this $8,000 tax credit
does not have to
be repaid to the IRS.
Can I use the tax credit
toward a down payment or other closing costs?
Yes. An announcement made May 29 allows the tax credit to be used toward
purchase costs of a home, including down payment in some cases. This can
be done one of two ways. First, buyers using an FHA-approved lender can
sell their anticipated tax credit to the lender and use the proceeds to
immediately apply the tax credit to any down payment above the minimum
down payment of 3.5 percent required with FHA-insured mortgages. Second,
buyers who receive financing through state housing finance agencies and
certain non-profits will be able to use the tax credit for their down
payments via a tax credit advance loan that does not result in any cash
back to the buyer. In both cases, buyers can only access the credit
after filing their tax returns with the IRS.
Information in part Courtesy of National Home Builders
Association |
Main Office
212 Caitlyn Drive * Hampton, GA 30228
770-477-9995
office | 770-478-7797 fax
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