2009 First Time Home Buyer $8,000 Tax Credit!
FIRST-TIME HOMEBUYER TAX CREDIT
As Modified in the American Recovery and Reinvestment Act
Major Modifications Italicized
February 2009
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FEATURE
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CREDIT AS CREATED JULY 2008 APPLIES TO ALL QUALIFIED PURCHASES ON OR AFTER APRIL 9, 2008
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REVISED CREDIT – EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009
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Amount of Credit
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Lesser of 10 percent of cost of home or $7500 |
Maximum credit amount increased to $8000
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Eligible Property
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Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence. |
No change All principal residences eligible. |
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Refundable
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Yes. Reduces (or can eliminate) income tax liability for the year of purchase. Any unused amount of tax credit refunded to purchaser. |
No change Purchasers will continue to receive refund for unused amount when tax return is filed. |
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Income Limit
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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). |
No change Same income limits continue to apply. |
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First-time Homebuyer Only
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Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase. |
No change Still available for first-time purchasers only. Three-year rule continues to apply. |
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Revenue Bond Financing
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No credit allowed if home financed with state/local bond funding. |
Purchasers who utilize revenue bond financing can use credit.
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Repayment
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Yes. Portion (6.67% of credit or $500) to be repaid each year for 15 years, starting with 2010 tax filing. |
No repayment for purchases on or after January 1, 2009 and before December 1, 2009
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Recapture
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If home sold before 15-year repayment period ends, then outstanding balance of repayment amount recaptured on sale. |
If home is sold within three years of purchase, entire amount of credit is recaptured on sale. Applies only to homes purchased in 2009.
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Termination
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July 1, 2009 (But note program changes for 2009) |
December 1, 2009
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Effective Date
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Purchases on or after April 9, 2008 and before January 1, 2009. Repayment to begin for 2010 tax year. |
All revisions are effective as of January 1, 2009
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