Home > Hershey Real Estate First-Time Homebuyers Credit

Details of Extended Tax Credit and Enhancements November 2009 Tax Credit for Homebuyers:  First-time Homebuyers (FTHBs), that is, people who have not owned a home within the last three years, may be eligible for the tax credit.  The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8000.  Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount. Current Owners:  The tax credit program now gives those who already own a residence some additional reasons to move to a new home.  This incentive comes in the form of a tax credit of up to $6500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years. Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount. What are the New Deadlines?  In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010. Tax Credit vs Tax Deduction.  It is important to remember that the tax credit is just that....a credit.  The benefit of a tax credit is that it is a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1000 to $1500 when all was said and done.  So, if a first-time homebuyer were to owe $8000 in income taxes and would qualify for a tax credit of $8000, she would owe nothing.  Better still, that taxx credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability.  For example, if a first-time homebuyer is eligible for a tax credit of $8000 but is liable for $4000 in income tax, she can still receive a check for the remaining $4000! Higher Income Caps.  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 receive a partial credit.  However, joint filers who earn $245,000 and above are ineligible. Maximum Purchase Price.  Qualifying buyers may purchase a property with a maximum sale price of $800,000. Remember, the new tax credit program includes a number of details and qualifications.  For more information or answers to specific questions, please call or email me today.  In addition, you may be able to benefit from additional housing related provisions, including the following: Tax Incentitives to Spur Energy Savings and Green Jobs.  This provision is designed to help promote energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation. Landmark Energy Savings.  This provision provides $5 billion for energy efficient improvements for more than one million modest income homes through weatherization.  According to some estimates, this can help modest-income families save an average of $350 a year on heating and air conditioning bills. Repairing Public Housing and Making Key Energy-Efficiency Retrofits to HUD-assisted Housing.  This porvision provides a total of $6.3 billion for increasing energy-efficiency in federally supported h ousing programs.  Specifically, it establishes a new program to upgrade HUD-sponsered low-income housing (for elderly, disabled, and Section 8) to increase energy-efficiency, including new insulation, windows, and frames. Expanding Housing Assistance.  This provision increases support for several critical housing programs.  It includes $2 billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties.