First-Time Homebuyer Tax Credit
The 2009 Economic Stimulus Bill, signed into law on February 17th, includes a tax credit for first-time homebuyers. All qualifying homebuyers are entitled to take advantage of this one-time tax credit.
Up to $8,000 tax credit. The tax credit is equal to the lesser of $8,000 or 10% of the purchase price of the home for first-time homebuyers who purchase a home after January 1, 2009 and before December 1, 2009. This replaces a previous $7,500 tax credit that was scheduled to expire on July 1, 2009.
Income requirements. Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 can qualify for the full tax credit.
First-time buyers. Individuals who have not owned a home in the past three years are considered first-time buyers.
Residency requirements. For homes purchased after January 1, 2009, this tax credit does not need to be repaid if the home is occupied as the buyer’s personal residence for the first three years from the date of purchase. Prior to this new legislation the former $7,500 tax credit was required to be recaptured over a period of 15 years or when the home was sold.
Tax returns. A provision permits taxpayers to claim the tax credit for homes purchased during 2009 on their 2008 tax return.