$8,000 Government Tax Credit for First Time Home Buyers

Some people have been asking me about the recent $8,000 tax credit for first time home buyers and I thought I should address it here. If you are buying or will buy a home in 2009 as a first time home buyer (see below for definition), you will be eligible for an $8,000 tax credit that you will not have to pay back. This is part of Obama's Recovery and Reinvestment Act and will replace the previous $7,500 credit that was previously in effect. So below are some of the qualifications necessary:

1. First Time Home Buyer Purchasing in 2009
A first time home buyer is defined as a someone or a couple who has not owned a home in the past three years. The purchase, or recording date needs to be between or on January 1, 2009 to December 31, 2009. If you're not sure about the dates, contact your real estate professional, if you have one, or you can always contact me.

2. Income Under $75,000 for individuals and $150,000 for couples
Your taxable income must be under $75,000 if you file as an individual or $150,000 if you file as a couple. You are still eligible for the tax credit if your income is higher than that but it phases out quickly to $20,000 over the limit.

3. Primary Residence for 36 Months
The home you buy must qualify as a primary residence for 36 months following the purchase date or else the credit must be repayed.

These are just the basic rules for the law. If you need the form, you can download it here. Also, I'm not a CPA or tax expert so don't rely on just this information. I have a really great tax planner if you need tax advice as well.