Last fall, Congress extended the Home Buyer Tax Credit to April 30, 2010 and expanded the program to apply to non-first time homebuyers as well. These buyers are sometimes referred to as “repeat buyers” or “long term residents”. Here are some further details on the Extended Home Buyer Tax Credit: Deadline: All buyers must be…
Last week Christy and I received an email from Kathy Korte, President and CEO, of Sotheby’s International Realty, updating us on ways the private sector are trying to jumpstart the sluggish housing market. A Business Roundtable was formed and here are the results of that meeting. Business Roundtable, an association of chief executive officers of…
Information about first time home buyer tax credits as amended by the American Recovery and Reinvestment Act of 2009 (HR 1).
We highly suggest that you please consult your tax advisor / accountant to determine whether you are eligible for this tax credit before making any decisions or changes to your tax status. This website is for information only and should be verified by a tax professional.
The 3 changes to the first-time home buyers tax credit program include:
Tax credit has been increased to $8,000.
Homes have to be purchased between January 1, 2009 and December 31, 2009
No repayment/recapture clause for homes sold after 36 months of occupancy and ownership.
The Tax Credit is for home buyers (either spouse if filing jointly) who have not owned a principle residence during the three-year period prior to the purchase.
The maximum credit is $8,000 or 10% of the home purchase, whichever is less – not an issue here in Jackson Hole or Teton Valley, Idaho.
The credit is available for homes purchased on or after January 1, 2009 and before December 31, 2009.
To qualify for the full tax credit, married couples’ modified adjusted gross income should be under $150,000 and single filers’ modified adjusted gross income should be less than $75,000. Partial tax credits may be available for married couples with modified adjusted gross incomes of over $150,000 but under $170,000 and single filers with incomes over $75,000 but under $95,000. If married couples who qualify for the first-time tax credit file separately, they would both claim 5% of the home purchase or $4,000 each on their tax returns.
Home buyers who qualify for this program, but who do not intend to purchase a home till the end of 2009, may elect to alter their tax withholdings (up to the amount of the of the tax credit) in order to save up money for a down payment. However, if the purchase of the home does not occur, the taxes must be repaid to the IRS.
There is no recapture or repayment clause IF the home is owned for at least 36 months.
The effective date of purchase for new construction (even if buyer owns title to the lot) is the date the owner first occupies the house. So even if construction began in 2008, as long as the home and buyers qualify for the tax credit, they will be eligible if they take possession any time during 2009. However, new construction bought from the builder is only eligible if the settlement date (closing) takes place between January 1, 2009 and December 31, 2009.
The law allows taxpayers to elect to treat qualified 2009 purchases as a 2008 purchase so that they can receive the tax credit on their 2008 tax returns.
The full amount of the eligible tax credit is refunded to the buyer, regardless of whether the buyer has paid an equivalent amount in taxes.
The American Recovery and Reinvestment Act of 2009
February 17, 2009 Christy and Garth Gillespie, the “Jackson Hole Experts” have reviewed the Stimulis Bill and Treasury announcements made last week and being signed today and here are our thoughts. We were in support for a $15,000 tax credit but that was defeated. We are very excited to report much of what the National…
If you decide to purchase a home within the next year, you will be entitled to a $15,000 tax credit, thanks to an amendment written by Georgia’s Senator Johnny Isakson. This amendment to the economic stimulus bill will be available to any home buyer within a year of it’s enactment. Homebuyers will be entitled to claim a […]