Time Is Running Out On $8,000 Tax Credit

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We recently attended a seminar, and one of the discussions centered upon the First Time Homebuyer’s Tax Credit.

In a recent survey, it showed that there is a lack of public awareness of this onetime federal program.

The First Time Homebuyer’s Tax Credit is for a maximum of $8,000.

In other words, Uncle Sam will give you $8,000 to buy a home if you meet the following qualifications:

You must be a first-time homebuyer. The definition of a first-time homebuyer is anyone who has not owned a principal residence for the last three years.

So a first-time homebuyer does not necessarily have to be a first-time homebuyer.

In order to qualify for the full $8,000 tax credit, the home being purchased must be at least $80,000 and purchased no later than December 1, 2009. Time is running out.

The most significant difference between this tax credit and the one U.S. Congress passed in 2008 is that it does not have to be repaid as long as the owner lives in the home a minimum of three years.

If the home is sold prior to three years of occupancy, the tax credit is repaid to the government.

To obtain the maximum tax credit, a single homebuyer may have an adjusted gross income no greater than $75,000, and a couple no greater than $150,000.

Adjusted gross income may be more, but the tax credit benefit will be decreased.

Single-family homes, mobile homes, townhouses, condominiums and manufactured homes all qualify for the tax credit.

This may surprise you, but even houseboats qualify for the credit if they are purchased and lived on as a primary residence.

A very important feature of this tax credit is that the credit may be claimed against your 2008 IRS tax return.

This allows a qualifying homebuyer to get their $8,000 within approximately 60 days of closing on the home.

It is important to restate that, at the time of this writing, this benefit will expire on December 1, 2009.

To realistically close on a home before that date, a person should be under contract no later than October 1, 2009 in order to meet a closing date of December 1.

Mortgage interest rates are showing an uptick, therefore, if you are thinking of buying and you qualify for this program, it would be wise not to procrastinate.

Ray Pugel is a designated broker for Coldwell Banker Bishop Realty. Contact him at (928) 474-2216.

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