New Homeowner Tax credit
Since Congress approved the New First Time Home Buyer Credit in April 2008, we have focused on helping people file amended returns to claim their refund. An amended return is the fastest way to receive the refund cash in your pocket. We charge a small fee for preparing the Return, which includes any necessary follow-up with the Internal Revenue Service.
If you have recently closed on a new home and qualify for the New First Time Home Buyer Credit, you should file an amended return as soon as possible following the closing. Waiting to file until your 2009 return is extremely risky, for if your income spikes unexpectedly (severance package, lottery winning etc) you may no longer be qualified.
If you purchased your first home between April 9, 2008 and November 30, 2009 you most likely qualify for the New First Time Home Buyer Credit. For purchases after January 1, 2009 you are eligible for the enhanced credit of up to $8000. Unlike the 2008 $7500 credit, the 2009 credit does not require any repayment as long as you live in your new home for at least three years. The IRS considers any home to be your "first" home if you or a spouse has not owned a home used as a primary residence in the past three years.
In order to qualify, your income must be below $95,000 if single or $170,000 if married. The credit equals 10% of the home purchase price with a maximum of $7,500 in 2008 and $8,000 in 2009. These maximums are per property, therefore if two people qualify for the credit they must split it. Additionally, the credit is reduced if your income is over $75,000 if single or $150,000 if married.
A First Time Home Buyer is someone who has not owned a primary residence in the last three years. Vacation homes or rental properties do not apply. The IRS considers any property owned by a spouse or ex-spouse to be owned jointly. This means that if you were divorced two years ago, but your spouse owned your primary home at that time, you are not qualified for the First Time Home Buyer Credit. This is true even if your name was not on the deed or mortgage.
Your new home can be a traditional single family, a mobile home, a houseboat or even something you are building as a primary residence. You can also rent out your spare bedrooms as long as you are living within the residence as well. To receive the full $8,000 credit, your home must cost more than $80,000 otherwise you will receive 10% of the purchase price. However, there is no maximum limit on what it can cost.
Once you have purchased you new home, the IRS allows you to amend your 2008 tax return so you can receive your money right away. Otherwise, you would have to wait until 2010. With an amended return you should receive your refund within 60 days.
In order to file your amended return we need the following items: