If you are interested in the First Time Home Buyer Tax credit of $7,500 you may have some questions.
First, who is eligible for the tax credit? A first time home buyer is a person who has not owned a PRINCIPAL residence in the 3 year period prior to this purchase. If you are single, this is easy to understand, but if you are married, NEITHER husand NOR wife can qualify if either one has owned a principal residence in the 3 year perior prior to purchase.
Second, the home must have been purchased (closed) between April 9, 2008 and before July 1, 2009. It can be a single family home, or a condo, or a townhouse, as long as it is the Principal residence.
Third you do not have to be a US Citizen to claim the th credit. IRS Publication 519 clairifies Non Resident Aliens, who are NOT eligible to claim the credit. If you are not a nonresident alien and have not owned a principal residence in the past 3 years, and if you meet the income limits test, you may be able to claim a tax credit. (See your CPA if you have doubts about this)
Are there income limits on this credit? Yes. There are modified adjusted gross income limits and there are partial tax credits. Your tax advisor is the best source of determining your limits.
Does the money (tax credit) have to be repaid? Yes it must be repaid.It must be repaid over a period of 15 years, or when you sell your home, if there is sufficient capital gain from the sale. (This is without interest). A homeonwer claiming the full credit of $7,500 would repay the credit at $500 per year. Payments can wait two years after the credit to begin repaying the credit. A sale of the property would demand payment in full of the remaining credit amount out of the profit The remaning credit payback would not be required if there is not enough profit.
These are a few of the questions and answers regarding First Time Home Buyer Tax Credits. You should always contact your tax attorney, or CPA prior to making buying decisions using this Tax Credit.
When you are ready to find your perfect home, call me at 706 865 5700 or 706 839 8841. You can look at all the area MLS offerings on my website, http://www.FlynnTaylor.com email to: Flynn@FlynnTaylor.com I look forward to assisting you in your investment, relocation, retirement or vacation home! Welcome Home!