By Jason Wall Finally there are clear and understandable guidelines to the first time homebuyer credit. Thanks to the IRS (yes the Internal Revenue Service) there is a very nice Q & A page regarding the 2009 first time homebuyer tax credit.
Q. What is the credit?
A. The first-time homebuyer credit is a new tax credit included in the recently enacted Housing and Economic Recovery Act of 2008. For homes purchased in 2008, the credit operates like an interest-free loan because it must be repaid over a 15-year period.
The credit was expanded in 2009 for homes purchased in 2009, increasing the amount of the credit and eliminating the requirement to repay the credit, unless the home ceases to be your principal residence within the 36-month period beginning on the purchase date.
Q. How much is the credit?
A. The credit is 10 percent of the purchase price of the home, with a maximum available credit of $7,500 ($8,000 if you purchased your home in 2009) for either a single taxpayer or a married couple filing a joint return, but only half of that amount for married persons filing separate returns. The full credit is available for homes costing $75,000 or more.
Q. Which home purchases qualify for the first-time homebuyer credit?
A. Any home purchased as the taxpayer's principal residence and located in the United States qualifies. You must buy the home after April 8, 2008, and before December 1, 2009, to qualify for the credit. For a home that you construct, the purchase date is considered to be the first date you occupy the home.
Taxpayers (including spouse, if married) who owned a principal residence at any time during the three years prior to the date of purchase are not eligible for the credit. This means that you can qualify for the credit if you (and your spouse, if married) have not owned a home in the three years prior to a purchase. If you make an eligible purchase in 2008, you claim the first-time homebuyer credit on your 2008 tax return. For an eligible purchase in 2009, you can choose to claim the credit on either your 2008 or 2009 income tax return.
Karissa Webster
Diane Easley
Carol Gabrielson
Christiaan Bourdrez
Aune Tietz
Dan Goforth
Allen Jaworski
Jason Wall
Marjie Cunningham
John "Mack" McCoy
Danny Adamson
Claire Zaner
Glenn Roberts
A clear and comprehensive report from the IRS? Perhaps the new and literate administration is having some influence. I can imagine that renters will be leaping (with joy) from their windows when they realize what $8,000, plus lower than 5% mortgage interest rates, plus astoundingly low home prices, plus unusually large inventory will do for their bottom line.