Many people who have never been able to purchase a home on the Main Line would love to take advantage of the new 2009 $8000 tax credit, but they don’t have enough money for a down payment or to cover the closing costs. If you are a first time home buyer and you need your 2009 $8000 tax credit to help you purchase a home, there is a way to receive your tax credit early. First time home buyers who would qualify for the tax credit are allowed to lower their income tax withholdings up to the amount of the tax credit. This extra money will be brought home in the buyers take home pay. Buyers can then save and use this extra money to help them with their down payments or their closing costs. Buyers just need to adjust their withholding amounts on their W-4 through their employer or quarterly estimated tax payments if they are self-employed. However, if a buyer does decide to lower their income tax withholdings and does NOT make a tax credit qualified purchase then they would have to repay the IRS for the income tax possibly including even interest and penalties. If you would like to read the rules and guidelines concerning income tax withholdings, they can be found in the IRS Publication 919.
Also, some rules were changed as part of the stimulus package to allow first time home buyers to claim the tax credit and take part in a program financed by tax-exempt bonds. Some state financing agencies, such as the Missouri Housing Development Commission, have developed programs that provide a short-term loan in the amount of the tax credit to first time home buyers which can then be used for a down payment. Potential first time home buyers should contact their state housing finance agency to see if such a program exists. Most of these numbers are listed by state on the website www.housingfinance.com
Regards,
Sarah
Visit me at: www.sarahsellsthemainline.com.
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