First-Time Homebuyer Tax Credit…….
As a home buyer in O’Fallon MO I am sure that you have heard a lot about the first time homebuyer tax credit and may have questions about what may be available to you.
This tax credit for first-time home buyers was modified in the American Recovery and Reinvestment Act that was signed into law by President Obama on February 17, 2009. The table below shows the modifications/changes* that were made to the original act of April 9, 2008.
|
FEATURE |
CREDIT AS CREATED JULY 2008 APPLIES TO ALL QUALIFIED PURCHASES ON OR AFTER APRIL 9, 2008 |
REVISED CREDIT- EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009 |
|
Amount of Credit |
Lesser of 10 percent of cost of home or $7,500 |
Maximum credit amount increased to $8,000 |
|
Eligible Property |
Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence. |
No change All principal residences eligible. |
|
Refundable |
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 fro unused amount when tax return is filed. |
|
Income Limit |
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. |
|
First-Time Homebuyer Only |
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 |
|
Revenue Bond Financing |
No credit allowed if home financed with state/local bond funding. |
Purchasers who utilize revenue bond financing can use credit. |
|
Repayment |
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 |
|
Recapture |
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. |
|
Termination |
July 1, 2009 (But note program changes for 2009) |
December 1, 2009 |
|
Effective Date |
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 |
- Major modifications are Shaded
In addition to the above tax credit the state of Missouri is working on an additional $1,000 credit but it has not yet been passed or signed into law. As soon as this happens I will let everyone know.
I would also suggest that those who are looking to use this tax credit first seek the advice of a tax advisor to see how it would affect you. Once you have checked with your tax advisor then I would suggest that you contact a lender and get pre-approved of a home mortgage to see just how much home you are able to purchase.
If you are looking for a new home and a REALTOR® that knows the St. Charles County MO marketplace and one that has called O Fallon MO home for over 15 years give me a call. Call Don Rogers at 314-954-6775 or email me at Don@DRogersHomes.com and we can start you home buying experience today. By the way I am never too busy for your referral, so if you know of someone that is looking to buy or sell have them give me a call, too.
i am so happy to see everyone getting this info out there to the consumers! I love your chart - very easy to understand!
Don,
I did a blog yesterday for localism in my area of Dyersburg,Tn for this information. This should help some buyers.
I still haven't posted here about the tax credit yet, and I need to get on the ball.
This should help people understand what the regulations are. Now if they just stop changing them!
Thanks for the information on the tax credit, I would love to be able to use it for down payment, but it is my understanding that you can't on this one!
It is a great program for buyers and we need to do more to promote it on our listings.
Good morning Ms. Leesa,
Thank you ma'am for stopping in it is always a plrasure to hear from ya. I hope that folks get the message that there is help when they get ready to buy.
Mike,
I am hoping that people get this message. We need to help the buyers all we can.
JL,
What's taking you so long? Better get it in gear my friend.
William,
Maybe, just maybe they have stopped with all of the changes for a little bit. ;-)
Jamie,
You are right this is a tax break when filing end of the year tax returns.
Terry,
We need to promote this every opportunity we get. I think that we can and should place them on our market update posts too.