First Time Home Buyer Tax Credit

There has been a lot of talk (and confusion) about the economic stimulus bill and what it means to home buyers. Who qualifies? What year can I claim the credit? How much of a refund would I get back? What are the criteria to receive the credit? So I'm going to attempt to answer the most common questions about the bill. Keep in mind, I am NOT a tax professional or accountant and always recommend when it comes to your taxes to seek the advice of an accredited tax professional.

That being said, the bill states that first time home buyers can claim a tax credit worth $8,000 OR 10% of the home's value, whichever amount is less. So, if you bought a condominium for $65,000, your tax credit under the bill would be $6,500, not $8,000.

Qualifying

In order to qualify for the credit, the home purchase must be made between January 1st and November 30th of 2009 (so if you buy a home on December 1, 2009 you are not eligible). In addition, there are income restrictions as well. To qualify, a single person must make less than $75,000 a year. Married couples must make under $150,000 a year. However, higher income buyers may receive a partial credit. You must also live in the house purchased for at least three years or you will be required to pay back the credit. The property being purchased can not be owned by a close relative like a parent, grandparent or one of your children. The definition in bill for a first time home buyer is anyone that has not owned a home in the last three years.

Tax Filing

The credit can be claimed on your 2008 or 2009 income taxes. Now as I said you can claim the credit on your 2008 tax filing. If you have already filed them, you can file an amended return to claim the credit if you wish to do so. Based on the feeback we've been getting, the process takes about 12 weeks. Another great thing about the credit it that it is fully refundable, so even if your total tax bill (refund) is less than $8,000 (and you qualify for that amount of a credit), you would still receive the full $8,000 back plus the amount you had overpaid.

For example, John's taxes showed that he had paid $5,000 in taxes over the year. He filed his return and he actually only owed $3,000 in taxes. Normally he would have received a refund of $2,000. But under this bill, he would receive the full $10,000 instead! To claim the credit on your taxes is just a matter of filling out the form, without any additional paperwork involved.

This is a simplified breakdown of the economic stimulus bill. I highly recommend consulting a professional tax service regarding your taxes. You can download the tax form here: http://www.irs.gov/pub/irs-pdf/f5405.pdf

Thank you for reading our real estate blog and feel free to contact us for all of your Las Vegas NV real estate needs.  

Source: CNNMoney.com

Comments

Update... Tax mailed on

Update...

Tax mailed on 2/5/10. After 3 weeks IRS website said I was going to get my refund by April 6, 2010.

Yesterday 3/31/10 I received a letter stating that I need to send in my HUD-1 final settlement statement. I dont know what happened to the copy I sent to the IRS. I called the IRS office and asked them if they have my HUD1 copy on file. They could not tell me because they say they dont have access to the records office and the letter I received is from the records processing center. I told them I would like to know if they lost my copy or have a copy but maybe the HUD1 I sent does not meet their requirement in some way. I was not able to get an answer whether they received it or not or if something was wrong with my HUD1. All they said was to send it again and include a letter telling them I have sent a copy before. I asked the person what if I get the same letter asking for the HUD1 again after I send this one. They dont have an anwer. So I sent my HUD1 out today 3/31/10 and I included a letter asking them to call my cell anytime if they have any problems with my HUD1. I told them this is the only copy I have which I got from my escrow company.

So back to the waiting game of up to another 8 weeks as I have been informed. At this rate I wont even get my tax by the beginning of Summer if all goes well.

I will update later....

We had the same issue as

We had the same issue as you, I was so irritated and asked all the same questions. What happened to copies I sent with my return, how do I know this will not happen again, why on Earth can I not speak to someone who works in this department. Of all the things that have made me angry about this year's tax refund, this made me livid. How in the World can they send me a letter demanding me to resend information that has somehow just disappeared but I can not even speak to anyone who has the answers as to why I'm getting the letter in the first place. That was 3 weeks ago, I was so angry that I called my Senator's office and they are helping me to get this resolved. The strange part is on the WMR site it has been saying "Processing, should receive by April 27th if no errors" but has not been changed at all. We are suppose to have ours dd, which would be tomorrow. Does that mean the system isn't working properly or they just haven't updated it or maybe (doubtful) I will receive it tomorrow? Has anyone had something similar happen?

Jan 25th was when they got

Jan 25th was when they got my paper file (I tracked it so I knew what day they got it) and didn't show up on the website for a while, but when it did it said "on or before April 6th" then a few weeks later it said "on or before April 20th" and NOW it says "on or before May 4th" I'm REALLY getting sick of the moving target date :(

Has anyone......

Has anyone received a refund after WMR Tool indicates a reference Code of 1301??? Thanks!

7 months and still waiting.....

Here is my story: Ammended my taxes on Sept. 5, 2009 to receive the first time homeowners tax credit. Middle of Nov. heard from IRS needing more documents for proof. Sent the documents in immediately. Called several times, finally they I hear from them at the end of Jan. I was denied the credit. They said that I already owned a home........not true. I own a small plot of land, with nothing on it. I of course send in more info to prove that I am a first time homeowner. During this time, I receive a letter from them saying that they apologize for not getting back to me for what I sent them in Nov. Now I am really confused.....they did get back with me!!! I have still not heard anything back and have really given up hope. I have come to peace with not getting it. I would have purchased my home anyway......just done things a little differently. I know that the Lord will provide for my family....with or without it.

I just got my First Time

I just got my First Time Home Buyer Credit. My waiting time was only a month and half. The process worked for me. Good luck to everyone!

Right....

Can you upload a copy of your check with your name blocked out.... We are all starting the think we've been hosed again by big government.

Let me guess you work for the government right?

I glad you got tax credit

I glad you got tax credit and thank you.

Another day, another dollar

I closed on my 1st home May 22, 2009, sent off an amended 2008 return for the first time home buyers credit - it was received by the IRS on June 11, 2009. I recieved a letter to fill out another form, so i did and sent it back the next day - that was in september - then received another letter saying that they needed more information, so i gathered all of the information that they asked for and then some - just so there would be no question that this is my house - and sent it back the next day, which was in january 2010. it is now the end of may 2010 and i was just told that i was denied for the credit because they think i owned a home prior to the one i just bought! so now i have to send some sort of documentation showing that i didn't own the residence, that i was renting - how much more crap are they going to put me through?? It has been 10 months and i am still waiting for my 8k tax credit but when i owed them 1400 they charged me interest and took what was left owed out of my refund from 2009! when u owe them money, they want it now but when they owe us money, they take their sweet time! what am i suppose to do? does anyone have any suggestions that my help?

Shady

November 19th 2009 is when the IRS received my information. The only contact I have received since then is myself calling them 3 different times. The first two times they said it was being reviewed. The last time, a lady said that in January it was closed, which means that someone was just done reviewing it, but it should take up to 16 weeks. I officially started week 19 this week. She also said that I should have received letters letting me know what is going on.

This has also happened to a friend of mine, however he actually received a letter saying he should see it in 2 weeks, that was 7 weeks ago.

IS THERE SOMEONE WE CAN CALL, OTHER THAN IRS? Please let me know if that is the case, I am out of GA, so I am dealing with the Atlanta office.

If I owe the IRS (Gov.) money then they would take it. Well they owe me money, they made promises, and haven't followed through. And now Obama is setting up several billion to help people out with their home loans????!!!! How bout you pay the people you owe before you make a bunch of other false promises!!!

Refund Status

I sent the hud and signatures, they confirmed the receipt. I had a message that the refund would be there by April 10th (or something close to that). The status changed and said I would be receiving a notice. I received a refund for the amount minus the $8000 so II called and she said that my return was up for review and this was normal and I would be receiving a CPO5 letter. She read it to me and basically it says no information is required as they are just reviewing my forms. She said it would be 4-6 weeks. I mailed my forms in at the beginning of February. I used Turbo Tax and sent in everything that TT said was required which included the HUD and signature page.

At least you got somewhere!

At least you got somewhere! We got our refund minus the credit, and the only thing they will tell us is "A letter dated April 26 should be arriving shortly with the details as to why we adjusted your refund"
SOO Frustrating!

Our tax person told us you

Our tax person told us you can't file for the FHBC online. You MUST file threw mail, I imagine this is why you went into review, the cases of fraud have all been by filers doing it electronically.

I did my taxes the same way

I did my taxes the same way you did sent in everything turbo tax said to send in and i fed ex to IRS for next day. i checked it said i would get it today, april 6, 2010 but i am hearing from others that they like to send them on fridays, so i will wait till the end of the week and check back up. Havent gotten any letters in the mail either. So im guessing I will get everything minus the 8k like you did. Have you gotten any further notices?

Still waiting after 3 months

I found this website in my search for information. I mailed my first time homebuyer tax credit, single, Jan 22 submitted a hud 1 settlement, tax documents and homeowners insurance and it was received by the IRS March 2nd, a whole month later. I was told to wait 6-8 weeks for processing. The online refund status results first read I should receive my refund by March 30 and then it was later changed to read, "We have sent you a letter with information regarding your refund" which stated to wait another 45 days as my return was selected for review. The online status update now reads "We have received your tax return and it is being processed. Unless we find mistakes or you owe other taxes, you should receive your refund by April 27, 2010". When I call the 1-800-829-0582 IRS number, I was told to follow the letter and wait at least another 45 days which would be around May 15. I have applied for a tax advocate who submitted additional information, HUD 1 settlement, homeowners insurance, utility bill, cashiers check, identification and tax papers. I have maxed out my credit cards and I am in great debt waiting for a tax refund and I am beginning to wonder if I am being audited or if I will ever receive this tax credit. Today the IRS operator told me it was a waste of time to send in additional documents if the letter did not tell me to send in additional documents they will wind up on the garbage. What a frustrating nightmare this whole process is to wait, wait, wait and wonder with no exact information, only generic replies from the IRS.

Consult a Tax Professional

Please Please Please! If you don't fall within the parameters set do not try to claim the tax credit . Information about the home buyer credit is on the irs.gov website or you can consult a tax professional. The reason why it's taking so long for returns to rightful submitters is due to the number of mistakenly or fraudulently submitted credits. Even if you recieve the return that doesn't mean you can't be audited after the fact. You'll owe more than the credit once pentaly and interest is applied if you weren't due the credited refund.

Finally got a release date!!!!!!! Yayyyyy

I closed on oct 9. Info was received by IRS on 10/16/09 as an amended return.
I ended up being sent to reviews. Sent info in immediately and it was received on 3/9/10. As of today, I was told the information was put in the system to release my payment as of 3/27/10. I wonder how much interest if any it will include. I am excited. There are some things I'd like to do to the house and I really didn't want to do anything on credit. This will be great. I plan to make an extra payment toward the principle also. I really want this house paid off in 15 years rather than 30.

Got my amended return $8000

e-filed 1040 with H&R Block on Jan 15 & had my refund direct deposited on Jan 29.

Went back and amended 1040x on Feb 8. with H&R Block and mailed on Feb 9.

Called IRS on Mar 22 (800-829-1040) and they said the check was processed and would be put in the mail on Friday Mar 26.

Received check on Mar 29.

was their a fee for the amened

DID H/R BLOCK CHARGE FOR YOU TO DO AMENDED AND HOW MUCH FOR THE
RETURN $8000

What prompts are you using

What prompts are you using when you call? I've tried all of them and either I get disconnected or an automated. The only answer I can get is an automated system telling me about my tax return but not the amendment... I can't even get an option to speak to a live person!?

sent out my tax forms on

sent out my tax forms on 2/1. the irs web site stated I would get my refund on April 6th. Today, March 29th i recieved a letter stating that they needed my HUD 1 form. I copied and sent it out today, immediately. I have been told it will be 6-8 weeks before I get my refund now. WHY, I asked, when they have started my paperwork and all they need is my HUD 1 form is it going to take 6-8 weeks when it should be picked up where it was started from? I was advised that they are extremely behind on processing the credits. I guess I just need to stay tuned here....

Finally Got it.

I bought my house Sept. of 09 and sent in my tax refund on November 4th of 2009. I got the check today 3/26/2010 so it took just about 6 months. I am happy I got it but gave up hope seeing the check till May at the earliest. Got about 233 dollars of interest. I can check that one off my list of waiting for. Hope you all get your checks soon.

2009 First Time Homeowner's tax refund

We closed on our house 12/23/2009, filed our regular taxes because we were told to send our other information separately and by paper. We did this February 23 and have heard nothing at all. I am not sure if, when we check online, the information is accurate or if it is showing errors because it was an amended return??? But it isn't showing anything. There are no specific numbers listed on the IRS website or links to check for this refund, so I am totally confused as to how to check on the status. We went through a professional tax service and submitted all the information required. Any input would be appreciated...Thanks.

tax credit

I filed a amended return on August of 2009, I called in December and no one knew anything about my return so i went thru 5 diffrent people trying to find out where it went. Then they stated that I had been radomly audited, meaning they needed more prove that I bought a home, so I had to fax in my title, deed, with all the signatures at the time of closing..blah blah..then they said it would be another month,.....This week will be month 8......so you guys are going to have to call once a week to get updates.....I would ask for the examination department....so right now, Im still waiting....Good Luck to all of you, i hate the irs

I filed my amended return in

I filed my amended return in September 2009 and has been calling since October and still nothing. First I was told they were waiting to verify my age so after sometime I called back and now its just we're working on it and we will have a tax advocate to call you in 7 business days and I have yet to hear from them. You would think by them being the government that they would be more organized. Hopefully I get good news soon.

Claimed on amended 2008 return...still waiting over a year!

I built a new house (my first home!), completed in March 2009. Amended my 2008 return to claim the $8000 credit. Examinations requested additional information. Denial after denial for numerous false reasons (seller's name not listed on the HUD-1 - it's a new house, there is no seller!, I've owned a house previously - no I have not, tell me where if I did!). Called Taxpayer Advocate Service in Oct, 2009. They reviewed everything and could not find any issues, and said to go through IRS Appeals. I sent everything to Appeals in Nov, 2009. Letter after letter from them saying they're very busy and to keep waiting. Finally in March 2010 (5 months later!), receive a letter from Appeals saying they do not handle these types of issues and they've sent my issue to an office in New York. So it's been over a year, and I've been just waiting...what else can I do? I am prepared to go to Federal Tax Court if Appeals rejects the claim. As someone else asked on here, yes the IRS does pay interest on these refunds if they're eventually approved. But the interest is taxable income on next year's return...

Pyramid Scheme

I think that part of the problem in getting these tax credits is that the country really is bankrupt and living on paper money. So, before the IRS can send you (the generic You) your rebate/tax credit they have to get that amount from someone else who owed money... a pyramid scheme. That and that the IRS is like all federal offices. By that I mean that someone gets a supervisory job and then their "power" goes to their head and they have to act like a jerk to justify having a supervisory job when totally unqualified to run a Kool-ade stand.

my income tax said ill get my check april 2 2010

I filed feb 26 2010 and I mailed in my 2008 taxes and now the where's my refund said april 2 my check will be mailed out ... but I wanted direct deposit ...why am I getting a check now and if they mail it out on april 2 2010 when will it be in my mail box what day

Was told to do an amendment for the $8000????

I called H & R Block and they told me my best bet was to go ahead and file my regular federal (I did in January and received it quickly), then amend it with the form 5405 and 1040X for the 1st time homebuyer tax credit. I mailed it in last week of January. Anyone have any tips or an valuable info on when I should expect this $8000 since I did an amendment? I kinda wish I would have just done it all together judging by what I've been reading. Any information would be much appreciated, thanks.

Call the irs (ext 326) and

Call the irs (ext 326) and check on the status. I mailed mine on Feb 22 and received confirmation today (by calling) that my check will be mailed on April 16.

They are telling me to wait they aren't sure they have it

I filed on 02/04/10. I am calling and they said it could be lost, but i have to wait until April 8th to resend it. Because if i send another and they find it. I was told it will not be processed until May. It would be nice to know if they even have it.

I sent my Amended tax off

I sent my Amended tax off the day after I filed my regular tax. I sent them the 20th of February and it is now April 6th and they said that they have even received it yet. I just don't get it.

hmm...thinking??

I HAVE READ VARIOUS POSTS STATING THEIR STATUS ON *WHERES MY REFUND* AND THE DATE THEY ACTUALLY RECIEVE IT ...AND IT IS A PATTERN OF 17 DAYS FROM THE *SHOULD RECEIVE BY BLAH BLAH BLAH DATE. SO... THOSE OF YOU HOPING TO RECEIVE THEM ....SEE IF THAT IS ACTUALLY ACCURATE? AND EVERYBODY IS MOSTLY RECEIVING THEIRS ON FRIDAYS...GOOD LUCK

IRS's has a Serious Communication problem

I sent my 5405 in with my 2009 tax return on 2/7/10 for a home I closed on late January. In the check your refund page at the IRS homepage, it states that my refund has been adjusted and I only received the balance of my refund for earned income...I talked to SEVERAL women at the IRS and none could answer the status of the homebuyer credit. All they stated was that it was denied, but could not tell me why. We went through all criteria for a qualifying citizen and could not find any issues. I am told a letter will come out in the near future, but could not tell me when. THIS SUCKS>>>Anyone have a similar issue?

Anyone having a problem with

Anyone having a problem with the IRS website stating that their funds are to be direct deposited (mine states April 2nd) but the Reps are stating a paper check to be mailed that day? Getting so much conflicting information from the reps that it's unreal. If I'm understanding correctly an amended return will not be direct deposited considering the first return already was. Anyone experiencing something similar to this?

Well here goes: Mailed

Well here goes:
Mailed return in on Feb 1, certified mail stated they received on Feb 6, kept checking IRS website to no avail, It wasn't until I checked it on march 21st that it even acknowleded that they had any info related to my return at that point they did give me an anticipated return date of on or before April 20th, I did not call to speak to an IRS rep, because until the 23rd of March it was not the given 6 week time frame and as I learned here, they wouldn't even offer help until after that point. I was super excited the day they gave me an anticipated return date, and also excited to start stacking some interest to their tab for once, but low and behold when I checked the bank today, it had been deposited! AMAZING how when THEY begin owing YOU money that they get a move on it. So those of you still waiting hang in there, to keep me upbeat I made a calendar decated to keeping track of how much the IRS owed me. Just a suggestion....

Nobody can tell me what the status of my return is

I filed my FTHBC in feb. 6 weeks later I call the numbers listed below but they can't tell me if my return has even been received. They just say that my account has not been updated and I should wait the 12 to 14 weeks. I read below people are being told the status od their returns and my question is who are you talking to to give you those answers cause I can't get anything out of the irs except they havnt received it and to wait

what crazy is that the

what crazy is that the address that was given to send the 1040x is in Atlanta. I live in Atlanta so they should have received my form the next day. I sent it off 2 months ago and they said that they have not even received it yet.

Tax Credit

I mailed my amended tax return to the IRS on 2/15/10. I called the next week and was informed that they had received the information on 2/17/10. Initially I was told that they have 12-18 weeks to process the claim and that I would receive the check at the earliest end of May. I have been reading different posts and one stated to call every week which I had not been doing. I called today and was informed that my claim was processed and that the check was mailed out on March 26, 2010. They said allow up to 14 days so we will see if this will really happen this quickly. Something is telling me that it is too good to be true. Good luck to everyone else waiting...

IRS Date changed...

Well, return was mailed (certified) and received by IRS Feb. 12th ……….IRS website on March 12th posted that I would receive my return by April 13th….Checked where’s my refund again on March 19th, and it still said that I would received by April 13th unless errors were found or I owe other taxes……..Now, today March 27th checked again………Now, date on the IRS website has been updated and it says that I would receive my return by April 27th!!!!!....What???.....Is anybody else in the same boat???...Has your date changed and were you able to at least receive your return by the second date posted?? Or are you still waiting?....I hope this doesn’t mean that my return has gone into review because who knows when I would receive it by????.....So I doubt that I would see my check in the mail 17 days after the IRS has posted a date for delivery of my return…That really sucks!!

mine has been saying i will

mine has been saying i will get my refund by april 6th unless there are processing delays or i owe more taxes..well today is april 6th and i have no refund...also i got a letter on march 29th saying that i need to send the 5405 form again..i wish they would update the wheres my refund so at least i would have some sort of idea when if ever to expect my income tax. i find it ridiculous that the irs is making us wait for just the income tax this long. even if they gave us that it would be something. i find it unexuseable honestly that i am waiting 3 months to get my income tax return. and i also think these last minute letters are stall tactics. if they needed that form again, why didn't they ask for it months ago..since my where's my refund status has been saying april 6th since end of february. plus with the letter that they sent me asking for that form they said it would take another two months to process the 5405, it is a one page form they have everything else besides my first born, i don't see why it would take another two months...it is a shame, they lure you in with this great incentive to buy a home then you have to wait until they decide to give you your income tax. while everyone else who didn't buy a home has theres already, so i guess by supporting the economy and buying a home, we are being punished...

Sent my return in 1st day

Sent my return in 1st day available Jan 18th, received my reg refund Feb 26th, and said they were sending my return to exams as they are with all the FTHBC, finally recieved my letter asking for info dated Mar 15th, turned around and faxed back the same day I received it which was Mar 18th. Don't get pumped up about the status on the web site, I too was told I'd receive by Mar 6th, and trust me they will change that. For those who haven't filed yet, or will for the FTHBC, send in your 5405 form, Hud 1, drivers license showing your new address, copy of your checking statement showing your new address, a car registration showing new address, don't wait for them to ask you, send it now, they will ask you, and hopefully you can cut a month or more off the time before they finally get around to telling you they need this information, which they will. Still haven't received mine and I thought I was pretty organized, had it there 1st day available Jan 18th, which reminded me, you can never be too organized for the IRS.

ERROR???

I mailed my 2009 taxes w/ my ftb disc info. I sent it 2/22/10 regestered mail, they rec 2/26/10. Monday it was in system saying refund will be before 4/27/10. I called today just to check and was told it was in the error dept, but had no other info for me. She thought I would be notified by mail.
Has anyone else had this issue?

Yes I am going through the

Yes I am going through the same thing, I sent my taxes in on 1/14/10 and had to paper file with the proof of purchase on the home. They never even recognized having my return until 3-17-10 and said I should recieve my return by 4/13/10, now they are claiming they need more information and supposedly sent a letter that I have yet to recieve. I just wondering if this is the IRS making more time for the credit they owe us.

home buyer credit

it is all in the documentation
if you sent out all required documents you should be o.k
mine is schedueled to be mailed april 2nd i filled on feb 18th

Yes, they received mine

Yes, they received mine November 19th 2009. They told me it would take up to 16 weeks, I am officially on my 19th week. I have called them 3 times, and they can't tell me anything. I have yet to receive any letters in the mail in regards as to what is going on.

first time home buyers refund

We purchased a home in august of 2009 sent in the ammened tax return in the begining of september of 2009 still no refund. Have called the IRS serveral times to hear one after another give a different date or reason now they are saying to call back in april. Due to the amount of fraud that is occuring with this refund.

HOW DID YOU GET TO TALK TO

HOW DID YOU GET TO TALK TO SOMEONE? i GET THE AUTOMATED SYSTEM THEN IT DISCONNECTED THE CALL

Number to call??

I mailed my taxes on 1/26/10, certified mail - they received it on 2/10. On 3/12, they finally had my status on where's my refund as 4/12. Yesterday I looked and now it says 4/27. I went over that thing 4 times to make sure everything was correct. If I get it 4/27 - that's 13 weeks from when I mailed. This is ridiculous, I'm gonna go BROKE waiting for this money, that I originally thought I would have by the end of February, or even end of March as they said on the press releases. Now it's the end of April?? WTH????

You said you called them and they told you something?? I looked everywhere and couldnt find a number to actually ask about it. What's the number you called??

I think you are supposed to

I think you are supposed to file your FTHC seperate than your 2009 tax return. I know this because I went to a mom/pop place to do my taxes, they sent them in together, but after 6 weeks of waiting the IRS said never received. I went to HR Block, and the very helpful staff informed me that the homebuyer tax credit has to be ammended. Hope this helps.

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