$8000 Tax Credit for First Time Home Buyers
Federal government announced a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence on or after January 1, 2009 and before December 1, 2009. This will definitely reduce the stress of closing amount for first time buyers. This rule is not only made for the first time home buyers but for all the home buyers. It was anticipated that Senate $15000 tax credit will be passed but somehow it was rejected by the committee. The negotiations was done on the bill increased last year’s $7500 housing credit by $500 resulting in the approved $8000 tax credit, or 10% of the purchase price– whichever is less. It also eradicates the requirement to payback the credit so long as you don’t sell your home for three years.
There are subtle differences between 2008 and 2009 housing credit. @008 housing credit schemes seems to be burden for the home buyers as it was simply a 15 year no-interest loan, payable in 15 installments, beginning in 2010.
In 2009 housing credit only the first time home buyers are getting facilities and they are treated as purchasers. The first time home buyers will have the facility of $ 800 if only if they don’t possess any home preceding their home purchase that must be made January 1 – December 31, 2009. One thing is to keep in mind that home buyers must not have closing on a home in the three years preceding their closing on the 2009 property. The new home buyers should not have any closing payment within three preceding years from the closing date of 2009 in order to qualify for the $8000 tax credit.
This new version sets eligibility criteria for the taxpayers. The criterion is that $75,000 adjusted gross income for single taxpayers and $150,000 for couples filing jointly. If someone purchases a home under state or local tax-exempt mortgage revenue bond programs then no tax exclusion is allotted. For the original $15,000 version, the purchase must be your primary residence and includes condominiums, single-family homes, co-ops, houseboats, and mobile homes, to name a few.
The reduction in tax will help the home buyers to spend money on furnishings, appliances, brokerage commissions, moving costs. The active government Congress is hopeful that it will revitalize the market to a certain extent.
Now the question is that how can someone apply for this reduction in tax? It is easy and simple. All you have to do is to just show your tax return – either your 2008 or 2009. No other forms or papers need to be filed. Taxpayers who submitted their returns can file amended returns for 2008 to claim the credit.
The final version is far less attractive than original $15000 tax credit version, it’s worth a look. If any home buyer qualify for the tax credit and don’t pay $8000 in taxes, you get the rest as a check.
Visit us at www.lonestarfinancing.com today for more information.
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