If you are thinking about buying a home in 2010, you may want to at least have it under contract before the end of April. That way, you can qualify for a tax credit of up to $8,000 (if you meet the other requirements).
The federal housing tax credit gives first-time home buyers and certain existing homeowners a major incentive to buy a home. Qualified buyers can receive a tax credit of up $8,000. The program has been extended until April 30, 2010, with no more extensions visible on the horizon.
Housing Tax Credit Q&A
1. Who can claim the $8,000 housing tax credit?
Anyone that meets the loose definition of first-time home buyer is eligible for the federal tax-credit program. If you have not owned a home (as your primary residence) in the three years prior to your home purchase, then you meet the IRS definition of “first-time” buyer.
2. Are there any other restrictions, such as income?
Yes. Single filers must make less than $125,000 per year, and joint filers must make less than $225,000. Due to possible changes, please visit the IRS website for updated amounts.
3. Is there anything for homeowners buying a new home?
Yes! Under the expanded tax-credit program, homeowners can simply buy another primary residence or they can sell their current home and then buy another one to qualify for a tax credit up to $6,500. The same deadline applies.
4. What if I don’t earn enough to need a CREDIT?
It’s not just a credit, it’s cash in hand. The government GIVES you a check for the amount you qualify if you owe no taxes.
5. Where can I learn more about the credit?
Visit the IRS explanation of the federal housing tax credit, and you’ll know exactly how it works.
6. Would this also be a good time to Sell?
Yes! More buyers trying to buy before April 30th means more homes being sold!
Please consult your tax advisor to verify that you would qualify for one of these available tax credit opportunities.
