You may have heard about the First-time Homebuyer Tax Credit that is part of the Housing and Economic Recovery Act of 2008.
I have included here the highlights of the credit and how it may apply to you.
Even if you are not considering a purchase at this time, you may know someone who is thinking of buying a home in the near future - so please pass along this information.
I also have available "Frequently Asked Questions" about the tax credit from the National Association of Realtors, which provides additional details. Feel free to contact me at anytime to receive a copy.
HOUSING AND ECONOMIC RECOVERY ACT OF 2008
First-time Homebuyer Tax Credit
|
FEATURE |
H.R. 3221 - Housing and Economic Recovery Act of 2008 |
|
Amount of Credit |
Ten percent of cost of home, not to exceed $7500 |
|
Eligible Property |
Any single‐family residence (including condos, co‐ops) that will be used as a principal residence |
|
Refundable |
Yes. Reduces income tax liability for the year of purchase. Claimed on tax return for that tax year |
|
Income Limit |
Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000, respectively) |
|
First‐time Homebuyer Only |
Yes. Purchaser (and purchaser's spouse) may not have owned a principal residence in 3 years previous to purchase |
|
Recapture |
Yes. Portion (6.67 % of credit) to be repaid each year for 15 years. If home sold before 15 years, then remainder of credit recaptured on sale |
|
Impact on District of Columbia Homebuyer Credit |
DC credit not available if purchaser uses this credit. |
|
Effective Date |
Purchases on or after April 9, 2008 |
|
Termination |
July 1, 2009 |
|
Interaction with Alternative Minimum Tax |
Can be used against AMT, so credit will not throw individual into AMT |
For more information on real estate in the Pittsburgh area, visit my web site at Pittsburgh Homes R Us.
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