Understanding the First-Time Home Buyer Tax Credit

We've all been hearing a lot the past couple of weeks about the first-time home buyer tax credit. Here it is in a nutshell for you. Notice that even if you have owned a home previously, you still qualify for this program if you have not owned a home in the past 3 years.

The American Recovery and Reinvestment Act of 2009 contains a provision to assist / encourage first-time home buyers with a home buyer tax credit of $8,000. Below is a brief synopsis of the program.

Give me a call if you have any questions at all, OR if you would like to go House-Hunting!

Amount of the Credit	Lesser of 10% of the cost of the home or $8,000
Eligible Property	Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence
Refundable	Reduces income tax liability for the year of purchase. Any unused amount of the tax credit is refunded to the purchaser
Income Restriction	Individuals with an adjusted gross income of less than $75,000 ($150,000 for a joint return) can receive the full tax credit amount. The program phases out completely above $95,000 per individual and $170,000 for a joint return.
Who is a first-time buyer?	Any purchaser who has not owned a principal residence in the past three years.
Revenue Bond Financing	Buyers can take advantage of this credit even if local or state bond financing is utilized
Repayment	This credit contains a recapture clause that will require that the entire credit is repaid if the home is sold within three years after purchase.
Effective Dates	For purchases between January 1, 2009 and September 1, 2009