First-Time Home Buyer Federal Tax Credit
For those who want to save a little money on your taxes this year and who would ALSO like to buy a house you can still get that $8,000 first time home buyers credit even though it was scheduled to expire November 30 2009. You now have quite a few months longer to qualify for the first time home buyers tax credit and this credit is a little different than the $7500 credit in 2008. In 2008 you could receive a $7500 tax credit but you have to pay it back over a 15 year time period. The tax credit going on now is free money you never have to pay back but it isn’t exactly free as some poor tax payer out their is paying for your welfare entitlement mindset which is why many of us feel a little anxious right now with the way this economy is going. The new law allows the credit to extend until April 30th 2010 and you must close on the house by June 30 2010. I recommend not putting off on buying your Tyler Texas home until the last minute.
The government considers you a first-time Tyler home buyer if you have not owned a home for at least three years before the date you settle on your new home. This credit will not work if you are buying investment property. You must be living in this home as your primary homestead or you will not be able to get this credit. If you want to try and get into the rental or vacation property business this credit will not be able to be applied for that purpose..
For first-time Tyler TX home buyers, the credit is 10% of the purchase price of the home, up to $8,000. So, if your house costs $80,000 or more, you can qualify for the maximum fedreal home buyers tax credit.
You do not have to repay this tax credit, as long as you live in your house for at least three years. If you sell or move out before three years, you have to repay the money as extra tax on your tax return for the year you sell or move.
If you are looking for a good real estate company in Tyler Texas we used Keller Williams and were very satisfied with their help in getting us into a house we liked at an affordable price.
Federal Income Tax Credit For Longtime Homeowners
This credit is available to qualifying home buyers who sign a binding contract by April 30, 2010, and who close on a new home between Nov. 7, 2009, and June 30, 2010. To qualify, you must have continuously owned and lived in a home for at least five of the eight years leading up to the purchase of a new home.
If you have owned and lived in your current home for at least five years, for example, you can qualify. If you bought the home you’re living in now less than five years ago, however, you won’t qualify.
The credit is 10% of the purchase price, up to $6,500. As with the first-time-buyer credit, this one is available only for the purchase of a principal residence, not a vacation home or rental property. And if you sell the place or move out within three years, you have to pay back the credit on your tax return for the year you sell or move. Homes that cost more than $800,000 are ineligible for the credit.
Income-eligibility rules are the same as for the first-time-buyer credit. The right to claim the credit disappears as adjusted gross income rises between $125,000 and $145,000 on a single return and between $225,000 and $245,000 for married couples filing joint returns.
To get your tax credit you’ll need to file a Form 5405 to claim the credit and include a copy of your settlement statement (such as the HUD 1 form) to prove that you bought the house. The settlement statement was not required for deals that closed before Nov. 7.
