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Here are six things you need to know about the $8,000 first-time home buyer tax credit. 

1.  $8,000 for new buyers: This credit is equivalent to 10 percent of the purchase price of the home–although it’s capped at $8,000 and applies only to first-time home buyers and principal residences. But unlike an earlier $7,500 home buyer tax credit, This one does not have to be repaid.

2.  First time buyers defined: For the purpose of this legislation, a “first-time home buyer” is someone who hasn’t owned a principal residence for three years before buying a house. (The date of purchase is considered the day that the title is transferred.) That means if you’ve owned a vacation home–but not a principal residence–within the past three years, you would still qualify for the credit.

3.  2009 buyers only: Only those who purchase a home on or after January 1 and before December 1, 2009 are eligible for the credit. Anyone who bought a home last year won’t be able to take advantage of it.

4.  Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit, that’s $150,000 for married couples. Those earning more than these thresholds may be eligible for reduced credits.

5.  Refundable: Because the tax credit is “refundable,” qualified buyers can take advantage of it even if they don’t have much tax liability. This tax credit will be refunded to a buyer, if his year end tax liability is less than the credit.

6.  Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the government. (Exceptions will be made in certain cases, such as death or divorce.)

Click Here to Watch an Informational Video

If you have more questions, please contact us via email or 219-661-1256. 

Time is Running Out!

by The Jana Caudill Team

Time is running out! Only 110 days left to take advantage of the $8,000 tax credit for first time home buyers. Purchases must be made before December 1st of 2009 in order to qualify.

First time home buyers are considered those who have not owned a home for three years. This tax credit is equivalent to 10% of the purchase price of the home, capping at $8,000 and is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit. Married couples need a gross income of $150,000. Those earning more may be eligible for reduced credits. The new home has to be their principal residence for three years.

This is just another great reason to now buy a home. To see a video explaining the tax credit, please click here. The Jana Caudill Team would love to help you find the home of your dreams. Please contact us for any assistance you might need.

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Contact Information

Photo of The Jana Caudill Team Real Estate
The Jana Caudill Team
Redkey Realty Leaders
503 East Summit St., Suite 2
Crown Point IN 46307
219-661-1256
Fax: 219-663-5949