Thursday, July 16, 2009
Considering Your First Home? Consider the $8K Tax Break
A reminder for those who are considering joining the ranks of homeowners: as a first-time homebuyer, you may be able to take advantage of a tax credit for homes purchased this year.
Qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.
The amount of the credit begins to phase out for taxpayers whose adjusted gross income is more than $75,000, or $150,000 for joint filers.
You are considered to be a first-time homebuyer if you, and your spouse if you are married, did not own any other main home during the three-year period ending on the date of purchase.
For homes purchased between April 8-Dec. 31, 2008, the maximum credit remains 10 percent of the purchase price, up to $7,500, or $3,750 for married individuals filing separately. In addition, the credit for these 2008 purchases must be repaid in 15 equal installments over 15 years, beginning with the 2010 tax year.
Consult a qualified tax advisor or visit http://www.irs.gov/ for information on eligibility, how to apply for the credit, and more.