Facts about the $7,500 First-Time Homebuyer Tax Credit

Real Estate Agent with Edina Realty

By Sara Huebener

The first-time home buyer tax credit is one of the most useful pieces of information we can share with buyers right now.  Even people not looking to buy their first home should know about the credit because the ability and ease in which buyers can make a purchase impacts home sellers in move-up brackets.  Here are some facts about the tax credit:

1.  The tax credit is available for first time buyers only, and the maximum amount of credit is $7,500.

2.  The credit is available for homes purchased on or after April 9, 2008 or before July 1, 2009.

3.  Qualifying buyers include single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000.

4.  The credit works like an interest-free loan and must be repaid over a 15-year period. 

5.  A first time buyer is defined as a buyer who has not owned a principal residence during the three-year period  prior to the purchase.  For married taxpayers, the law tests the home ownership history of both the home buyer and his/her spouse.   Ownership of a vacation home or rental property that is not used as the buyer's principal residence does not disqualify the buyer from eligibility.

6.  For purposes of the tax credit, a principal residence that is constructed by the home buyer is treated as having been "purchased" on the date the owner first occupies the house.  The date of occupancy must fall within the boundaries specified in number 2 above.  If a newly constructed home is purchased from a builder, the settlement date determines eligibility for the tax credit. 

More info can be found at www.FederalHousingTaxCredit.com  

Buyer resources can also be found at http://www.federalhousingtaxcredit.com/resources.html 

Comments (2)

Todd Clark
eXp Realty LLC - Tigard, OR
Principle Broker Oregon

And the best news about this "Stimulus Package" that congress is trying to pass is that the $7500 tax credit could become $15,000 next week.

Welcome to Activerain and happy selling,

Todd Clark, Helping Families Home - www.IFoundYourNewHome.com

Feb 05, 2009 05:06 PM
Chad & Sara Huebener
Edina Realty - Savage, MN

Well, so much for that for now!  Well, maybe something more will come of it down the road...I guess we should be happy there is at least $7500

Feb 15, 2009 12:15 PM

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