Federal Housing Tax Credit

It was great when we got the Federal Housing Tax Credit put in place and due to that certain real estate markets were able to start rebuilding. Now the Feds approved the extension of this tax credit ($8,000 for first time home buyers) and they also authorized a $6,500 tax credit for repeat home buyers. This is a great opportunity for so many people.

Here are a few key points to remember about these credits.

1. The $8,000 first time home buyer credit is for the purchase of a primary residence.
2. The first time home must be purchased between January 1, 2009 and April 30, 2010.
3. If you purchase after November 6, 2009 you will have an income limit of $125,000/yr. if you are single. $225,000 per married couple that file jointly.
4. For repeat buyers the income limits are $75,000 for single and $150,000 for married filing jointly.
5. The first time buyer credit is equal to 10% of the value of the home, up to $8,000.
6. Any home qualifies for the first time buyer credit as long as it is valued under $800,000.
7. These credits do not apply when you are purchasing a relatives property, an ancestors property, property of your in-laws, etc. No familial interaction is approved.
8. The credit is refundable. What this means is that even if you don't have withholding enough on your return to offset this, you still take it and you will be cut a check for the applicable amount as part of your tax return.
9. These credits also apply to people who have hired a contractor to build a home for them rather than buy an already existing home.
10. If you purchased a home after April 2008 but before January 2009 you do qualify for these credits but you may qualify for other credits.

These are just a few of the most talked about issues regarding the tax credit. You can find a lot of information at the site: federalhousingtaxcredit.com.

If you have further questions about how this can work for you please contact us and we will be glad to help you in any way that we can.