First-Time Home Buyer Tax Credit - 2009 Highlights

The American Recovery and Reinvestment Act of 2009 includes several provisions benefiting home buyers and home owners. Here is a summary of those highlights.

2009 First-Time Homebuyer Tax Credit

• Tax credit of 10% of cost of home to a maximum of $8,000
• All principal residences are eligible, including houses, condos, co-ops and townhouses
• To get your money after closing on your home, simply claim the credit on your federal income tax
• You can file with either your 2008 or 2009 tax return; if you are filing next year, you can adjust withholding or estimated tax payments this year to access funds sooner
• If you cannot use any or all of the tax credit you will get a refund for the unused portion
• Income limit of $75,000 per individual or $150,000 per couple for full credit; phases out after$95K and $170K
• Purchaser and purchaser's spouse may not have owned a principal residence in 3 years prior to purchase
• Tax credit does NOT have to be repaid unless home is sold within 3 years, in which case the entire amount of the credit is recaptured at time of sale
• Tax credit IS available to purchasers who use revenue bond financing
• Applies to purchases closed on or after January 1, 2009 and before December 1, 2009  

Other Provisions

• Tax credit of 30% of the cost of qualifying energy-efficient home improvements such as furnace or boiler, A/C, water heater, roof, windows, insulation...to a maximum of $1,500
• Allows state housing finance agencies to help buyers at closing by advancing the credit as a loan using proceeds from tax-exempt bonds
• FHA, Fannie Mae and Freddie Mac loan limits extended to $729,750 through 2009

More Information

• Click here for the above information in chart format
• Click here for answers to Frequently Asked Questions, provided by the National Association of Home Builders
• Click here for a fact sheet on the Homeowner Affordability and Stability Plan

Sharlene Hensrud, RE/MAX Results- shensrud@homesmp.com- HomesMSP.com

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