Homebuyer Tax Credit for First Time Homeowners
Homebuyers Program Offers Housing Tax Incentive
Sep 28, 2009
Through the homebuyer tax credit for first time homeowners program being offered by the Federal Government, potential homeowners are eligible for tax credits that can save them thousands of dollars. This is part of the American Recovery and Reinvestment Act of 2009, otherwise know as the Stimulus Plan. This bill provides a housing tax credit of up to $8000 to qualifying applicants who are eligible to take advantage of this homebuyers program. There is no repayment required for the 2009 housing tax credit program.
First Time Homebuyers Eligible for the Tax Credit Program
The homebuyer tax credit first time homeowners program will benefit those who have not purchased a home within the last three years and are buying a new or previously occupied home after January 1, 2009 and before December 1, 2009. This means that the buyer has to close on the house and all title transfers need to occur between these dates to take advantage of the tax credit.
Income Limits for the Housing Tax Credit
If single applicants for the homebuyer tax credit program make less than $75,000 annually they will qualify for the program. Married couples are allowed double this income amount to qualify for the housing tax credit. The amount of tax credit a homebuyer will receive is based on the purchase price of the house, and is either 10% or $8000, depending on purchase price. Those with modified income amounts may qualify as well.
Homes that Qualify for the Tax Credit Program
The tax credit program grants homebuyers that qualify for the tax credit monies to purchase all types of residences, including mobile homes, condominiums, town homes, and single family homes. Even houseboats are included in the homebuyers tax credit program. Additional rules and restrictions as stated by form 5405 First Time Homebuyer Credit, Internal Revenue Service Publication include:
- Homes cannot be purchased from relatives, gifted or inherited to receive the tax credit
- Home in which the purchaser has invested more than 50% stock, profits or interests are ineligible
- The home has to be in the United States
- The home must be used as a principal residence
- The buyer must not have previously purchased a home within the past three years
HUD Homebuyers Program
The homebuyers tax credit for first time homeowners who are purchasing a Housing and Urban Development (HUD) home can use the tax credit program money towards the purchase of their home instead of waiting till the end of the year to file for their tax credit. The housing tax credit can help cover closing costs for Housing and Urban Development homebuyers.
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