Home Buyer TAX CREDIT details and Qualifications

 Its part of the HR 3548 Bill called Worker, Homeownership & Business Assistance Act of 2009-Section 11. Read the highlights—but always consult your tax advisor for specific questions or unusual circumstances.

•          Tax Credit of $8000 or 10% of sales price.
•          Must be “principal residence”.
•          Could not have owned a home within 3 years prior to the closing date of new purchase.

• Tax credit of $6,500 or 10% of sales price.
• Must have owned home for 8 years and lived in that home consecutively for 5 years out of those 8 years. 
• Current home must have been principal residence.

• Member of “Uniformed” Services.
• Member of Foreign Service of the United States.
• Employee of Intelligence Community.
• Extended Duty defined as “Official Orders outside the United Stated for at least 90 days during the period 12-31-08 and May 1, 2010”.
• Tax Credit Dates Extended.

• Sign a sales contract between December 1, 2009 and April 30, 2010 and close by June 30, 2010.
• Qualified Armed Forces – December 1, 2008 and April 20, 2011 and close by June 30, 2011.

• $125,000 Single
• $225,000 Married
• Modified Adjusted Gross Income (MAGI) – can earn up to $20,000 more than income limits and still get a partial tax credit.

• 18 Years old on Date of Closing
• If married, and spouse is less than 18 years old, other spouse must be 18 years old

• $800,000

• Copy of HUD 1 must be attached to IRS 5405 “First Time Homebuyer Credit” form.

• Non-resident aliens.
• If property disposed of before the end of the tax year.
• If property ceases to be principal residence before the end of the tax year.
• If property is acquired from a person who is “related” to the homebuyer or if married, the homebuyer spouse (this was added to the HR 3548).
• Income exceeds income limits (MAGI calculations).
• Less than 18 years old.

• If home is sold within 36 months of acquisition, tax credit must be repaid in its entirety.

• Single Family
• 2-4 Family (one unit must be owner-occupied)
• Townhomes & Condos
• Houseboats
• Mobile & Modular Homes
• New Construction (Note – Date of land acquisition not address in extension provisions)