Who is Eligible

• The credit is 10% of the purchase price of the home, with a maximum available credit of $8,000 and is available for first-time buyers only.
  The law defines "first-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase.
  All U.S. citizens who file taxes are eligible to participate in the program.
  
  Payback Provisions
• The tax credit is a true credit. It does not have to be repaid.
  The only repayment requirement is if the home owner sold the home within three years after the purchase.
  
  Income Limits
• The amount of income someone can earn and qualify for the full amount of the credit has been increased. Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible.
  Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.

• First-time home buyers would receive an $8,000 tax credit for the purchase of any home. In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.Those in the military do have some special extensions on the timelines available.
  
  Tax Credit is Refundable
• A refundable credit means that if you pay less than $8,000 in federal income taxes, then the government will write you a check for the difference.
  For example, if you owe $5,000 in federal income taxes, you would pay nothing to the IRS and receive a $3,000 payment from the government.
  If you are due to receive a $1,000 tax refund from the government, your refund would grow to $9,000 ($1,000 plus $8,000 from the home buyer tax credit).
  Buyers can take the tax credit on their 2009 or 2010 income tax return.

 
      Types of Homes that Qualify for the Tax Credit

• All homes, whether single-family, townhomes or condominium apartments will qualify, provided that the home will be used as a principal residence and the buyer has not owned a principal residence in the prior three years. This also includes newly-constructed homes.
  For more details on the tax credit, go to the Federal Housing Tax Credit website
  For information about additional California Tax Credits click here.
  For additional questions, contact us today