| Are you planning on buying a home? Now is the time, | | | | but living together, the credit can be divided between |
| especially if you are a first-time home buyer. The | | | | qualified partners. Income limits are $75,000 for single |
| government has made it even more attractive to buy | | | | people or $150,000 for married couples. |
| a home right now, because as a first-time home buyer, | | | | How do you claim this credit? |
| you may be eligible for up to an $8,000 tax credit | | | | You claim your first-time home buyer credit by filing |
| when you do so. This tax credit gives you up to 10% | | | | IRS form 5405, the First-Time Home buyer Credit |
| of the value of your new home in a tax credit, not to | | | | form. You will file this form with the tax return that |
| exceed $8,000. | | | | matches the year you bought the house, such as |
| This tax credit has been around for a while, and was | | | | 2010's tax return. You will get a refund check after you |
| originally set to expire in November of 2009. In an | | | | have filled out the appropriate form and you have |
| effort to help first-time homeowners with buying a | | | | bought your home. Or if you have already file your |
| home and help bolster the sagging real estate market, | | | | 2009 taxes, you can then amend them so that you do |
| though, the tax credit was ultimately extended to April | | | | not have to wait until next year to claim your tax |
| 30, 2010. What that means is that as long as you stay | | | | credit. |
| in your home for three years, you do not have to pay | | | | Other information you should know. |
| that money back; you must buy the house before May | | | | Because the money from the tax credit comes to you |
| 1, 2010, and you must close on it before July 1, 2010, to | | | | AFTER you've bought your home, you are not going |
| qualify. If the house you are buying is new construction, | | | | to be able to use it for a down payment. So do plan to |
| the date you purchase the house is considered your | | | | save enough for a down payment on your own, or |
| date of occupation. | | | | get assistance from one of the many first-time home |
| How do you qualify for this credit?? | | | | buyer programs to help you with your down payment. |
| There are some rules to qualifying for this credit when | | | | Because Congress has recently passed laws (the |
| you are buying a home. You can not qualify for the | | | | Mortgage Disclosure Information Act and the new |
| first-time home buyer credit if you have owned a | | | | Home Valuation Code of Conduct) that will extend the |
| principal residence any time in the last three years prior | | | | closing process when you are buying a home, you're |
| to the date of purchase. This credit does not extend | | | | not going to be able to close on your home in 30 days |
| to rental homes in general, although you CAN qualify if | | | | anymore. Expect that process to take at least six |
| you buy a rental unit from one to four units large and | | | | weeks, and plan accordingly. |
| live in at least one unit, while renting the other 1, 2 or 3 | | | | Why is this credit such a benefit to you? |
| out. | | | | It may sound like a bit of a hassle to go through this |
| You also may not buy the house from someone such | | | | process, but in fact, you are getting what is essentially |
| as your spouse, or someone who is a "direct lineal | | | | "free" money from the government. It's not difficult at |
| descendant or ancestor" like a child or grandchild, but | | | | all; you just have to prove that you meet the |
| you CAN buy the home from siblings, nieces or | | | | necessary qualifications, and then buy your home |
| nephews, and other similar types of relatives. | | | | before April 30, 2010. After that, get set to receive |
| If you are married, both you and your spouse have to | | | | money back from the government after you've filed |
| qualify for the credit to buy, and if you are not married | | | | your tax return. What is not to like? |