It is clear that the $8,000.00 tax credit incentive for first time home buyers has been very effective in stimulating the real estate market in the past several months. However, the question that begs to be asked is "how do I use it?"
First, you need to find a home to purchase that you love!
Franklin Homes for Sale - Franklin Green, Forest Crossing, Falcon Creek, Cottonwood, Dallas Downs, Fieldstone Farms, Ladd Park, Maplewood, McKay's Mill, Oakwood and Sullivan Farms.
Condos - Andover, Ashton Park, Grant Park, Hardison Hills, Jameson Station, Laurelwood, McKay's Mill, Morningside, Reid Hill Commons, The View, Brentwood Pointe, Mooreland Estates, Barrington Place, Brentwood Villa, Concord Place, Heathstone Manor, St. Martins Square and Townhomes of Fredricksburg
Brentwood Homes for Sale -Brentwood Hills, Bridgeton Park, Brookfield, Courtside, Southern Woods, Foxboro, Grassland, Hillview, Oakhall, Southern Woods and Stonehenge.
Nashville Homes for Sale -Autumn Oaks, Banbury Crossing, Brentwood Chase, Concord Place, Copperfield, Cottonport, Fredricksburg, Hearthstone, Highlands, Indian Creek, Jackson Valley, Sterling Oaks and Williams Grove.
Then follow the Ins-And-Outs of the $8,000 First Time Home buyer Tax Credit
If you are like many Americans trying to figure out the best time to make your first home purchase, then you may want to take a closer look at the first-time home buyer tax credit included in the American Recovery & Reinvestment Act, which was signed into action by President Barack Obama on February 17, 2009.
Dont' be confused by the name. The credit included in this year's stimulus package is markedly different (read: better) than its predecessor from the 2008 package. So, what makes this tax credit different from the previous & just exactly what does it mean for you?
KEY DIFFERENCES - 2008 VS. 2009 CREDIT
Repayment
Perhaps the biggest departure from the 2008 credit is that the 2009 home buyer credit DOES NOT require repayment. While the '08 credit functioned very much like a 15-year interest-free loan, the '09 version is a true credit. Repayment of the credit is only required if the owner sells the property within 3 years of purchase.
Credit Amount
While both credits are equivalent to 10% of the purchase price of the home, the 2009 credit increases the limit of the credit from $7,500 to $8,000
OTHER IMPORTANT NOTES REGARDING THE CREDIT
1. Qualifying for the home buyer credit
The credit is for first-time homebuyers only. As it relates to this credit, a first-time homebuyer is defined as any taxpayer who has not owned a principal (or main) residence for a period of 3 years prior to the home purchase. The first-time purchase must be part of a principal residence.
2. Income Limitations
The legislation does limit availability of the first-time home buyer credit based on modified adjusted gross income (MAGI). Single filters with MAGI of $75,000 or less & married couples with MAIG of $150,000 or less are eligible for the full $8,000 credit. Those individuals or couples with MAGI above these limits may be available for a reduced credit on a phase-out basis.
3. Purchase Window
The 2009 first-time home buyer tax credit is retroactive to January 1,2009 & covers purchases through November 30, 2009.
4. Refundable Credit
The tax credit reduces your final tax liability & you will be refunded whatever portion, if any, of the credit that remains after applying the credit to taxes you owe for that year. For example, let's say you qualify for the full $8,000 home buyer credit & your total tax liability (after withholding) is $2,000. Your tax liability will be zero & you will receive a refund for the remaining $6,000.
5. Claiming the Credit
Claiming the credit is actually very simple, To take advantage of the first-time home buyer credit, you'll need to complete IRS Form 5405 which will actually help determine the tax credit amount. You'll then claim that amount on line 69 of your 1040 tax return form. No pre-approval forms or applications are required!
As with most issues related to a home purchase, be sure to consult with your Agent for additional information or to ensure that you & your prospective purchase qualifies for this home buyer tax credit. For any questions please contact Jeff Pate at 615-593-4325 or by email pateteam@comcast.net.
Source: Williamson County Association of Realtors
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