First-time Homebuyer Tax Credit $7,500 with new updates

Update: 2008 vs. 2009

Download First-time Homebuyer Tax Credit form 5405

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The $7,500 Tax Credit may have just gotten better. Current Legislation H.R. 3221 Housing and Economic Recovery Act of 2008 allows for a $7,500 Tax Credit for the purchase of a primary house.

If President Obama signs the 2009 Economic Stimulus Package into law, next Tuesday (17 Feb 09), the Housing Tax Credit will increase from $7,500 to $8,000 and will not have to be repaid. This is a true Tax Credit. …more updates to follow when Stimulus Package is signed.

Highlights of the current Tax Credit are in table below:

FEATURE	H.R. 3221 Housing and Economic Recovery Act of 2008
Amount of Credit	Ten percent of the cost of home, not to exceed $7,500
Eligible Property	Any single-family residence (including condos, co-ops) that will be used as a primary residence
Refundable	Yes. Reduces income tax liability for the year of purchase. Claimed on tax return for that tax year.
Income Limit	Yes. Full amount of credit available for individuals with an 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, respectively).
First-time Home buyers Only	Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase.
Recapture	Yes. Portion (6.67 % of credit) $500 to be repaid each year for 15 years. If home sold before 15 years, then remainder of credit recaptured on sale.
Effective Date	Purchase on or after April 9, 2008
Termination	July 1, 2009

Please contact me for further information or questions.

Standby for updates to the homeowners tax credit.

Mike Leonard, (850) 902-5710 or mike.leonard@era-american.com or visit my website at http://www.era-mike.com