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

Just heard the word...

Well, I just called (7:22am Eastern on 8/4/09) the IRS at 800-829-0582 ext. 462 and had to provide my information as usual and they put me on hold for about 3 minutes. When the guy did come back, he said the check (plus $80 interest) was mailed out on 7/31. This is pretty exciting, but still holding my breath considering all of the horror stories I have seen on here of people not receiving "sent" letters and checks. I filed my ammended return the first week of May (and after I had already received my 2008 tax return). I had a simple return, filing status was single, no crazy tax exemptions, pretty basic. I never owned, no confusion of owning; just bought the house, filed and was eligible for the credit. If for some reason I don't receive my money as I am expecting in the next week...or two, I will repost and let y'all know.

Best of luck to everyone - I would definitely call the number and talk to someone live. Around 7am, this morning, I tried to check the website and it said it could not find my info...so call and talk.

Let me know when you get your check

Hi,
I'm selling my house to people that are waiting on their check as well. It's getting really frusterating for everyone as it's been over 2 1/2 months. The last I heard is that the IRS was going to cut the check Aug 3, could you let me know how long yours takes to get it in the mail..I'm starting to get worried as well..
Thank you,
Taelor

Amended Return processes

I filled out an amended return on Jun 24 and called the IRS today and they said it has been processed and the check sent out on July 31st. We sent the return to the Georgia service center. I think the location it is sent determines the wait time. Ours was processed in about 5 weeks. Yeah!!! I'll be checking my mail.

So Crazy we are in the exact

So Crazy we are in the exact same boat....closed on my house March 26th filed on April 6th. The person on the phone from the IRS said we got the paper work but nothing has been done withit yet. We have only got the run around from the IRS they told us it would be 16 plus weeks. And when asked what to do the guy just said "WAIT"!!!!

16 weeks here

We closed on our first home on March 27. They received our amended return to include the credit on April 9 via mail. Our 12 weeks was up on July 2. After two calls to the IRS, they said that it's still in processing and has been "reassigned" to another individual which causes additional delays. I was told to check back in on July 31 (tomorrow).

Today is week 16 after IRS receipt and we're eagerly anticipating that check arriving.

1st time home buyer

if I bought a house after my husband and I seperated when we did our 2008 taxes and he owns a home do I qualify for the $8000 tax credit?? Please help.

Thanks,

Check was sent!

I filed my amended return on June 27th, I called today and they are sending the check tomorrow! I was ready to wait 16-20 weeks and I am so thrilled that I don't have to! After reading all of your posts, I asked the customer service rep why mine went through so quickly while others didn't. Her response "I guess you just it it at the right time". Gotta love the feds.

Refund

Hello -
I filed an amended tax return on June 1st and just found out today (July 30th) my check will be in the mail tomorrow. So total, it took me about 2 months and two weeks to get my refund. I called 1-800-829-0582, ext 462 to find out that information, although it is available on the IRS website - where is my refund link. The wait time was incredibly long, but the person I spoke to was very nice and gave me some good news!!!! Best of luck if you are still waiting. I was in the same boat!

1st time homebuyers credit

If someone owns a mobile home but do not own the property it is sitting on, nor any other property, do they qualify for the first time home buyers credit?

Not according to the IRS Tax

Not according to the IRS Tax Law department. I was told we would qualify, bought the house, now we are out $8K. That was our living money.

How stimulating

I think that the most frustrating part of all of this is that the government designed this program as an economic stimulus...the idea being that we would take this $8k and put it back into the American economy to stimulate it. My question is...if it is taking an upwards of 12 weeks to receive the money we've been promised, just how stimulating is that? Is this a ploy to make us wait until the Christmas shopping season?

First Time Homebuyers and Amended 2008 returns

Actually, you are very lucky that they even decided to allow you to amend your 2008 return to claim the credit early. The $8000 is a 2009 credit, not a 2008. Otherwise, you would have had to wait until you file your 2009 tax return in 2010 to receive the credit. In addition, amended returns are always notoriously slow. They are given low priority over original returns still being filed by those taxpayers who requested extensions of time to file on their return. The processing has been further delayed by taxpayers who have been fraudulently filing for the credit. Thanks to them, the IRS is now having to go over all of these returns with a fine toothed comb. You will get the credit eventually this year, if you are truly eligible and due the credit.

Land Contract

Does anyone know if this credit also applies if you buy your house on a land contract?

Land Contract

Found this information on a couple of other sites, thought it might be helpful!

A. If the taxpayer obtains the “benefits and burdens” of ownership of a residence in a seller financing arrangement, then the taxpayer can claim the credit even though the seller retains legal title. Factors that indicate that a taxpayer has the benefits and burdens of ownership include: 1. the right of possession, 2. the right to obtain legal title upon full payment of the purchase price, 3. the right to construct improvements, 4. the obligation to pay property taxes, 5. the risk of loss, 6. the responsibility to insure the property and 7. the duty to maintain the property.

yes you can claim it on a

yes you can claim it on a land contract

Land Contract

So it can be claimed if sold via land contract? What about the "burden" of taxes and insurance (if they stay on my name)

Also, what if there are multiple buyers?

Example:
A man, his girlfriend, and his dad have NOT owned homes in 3 yrs.

The home sales price is $240K

They want to split it 3 ways - $80K each

So, will they qualify for $8K credit each?

Thanks

I am helping my gran

I am helping my gran daughter buy her first home and I would like my name on the deed with her name. Will she still the tax credit with my name on the deed with hers?

Just wondering...

Googled "how long does it take to recieve first time home buyer tax credit" and found this site. My husband and I bought our first home the last week of May, had a CPA amend our tax return and mailed it off last week. Now of course I am anxious to know how long it is taking to get the money. Had no idea it was taking this long. As with other comments, when someone does recieve their payment, please let us know how long it took you. Thank you!

I went to settlement April

I went to settlement April 24, 2009. I had already filed my taxes, so I drove to H&R Block right from the settlement meeting and filed the amendment and mailed it that day. Here I am 15 weeks later and I still haven't seen the check.

When I originally filed, H&R Block said that amendments take 8-10 weeks to process, but they have seen them filed as soon as 2-4 weeks later. At 11 weeks, I called the IRS and asked them for a status. They said 10-12 weeks is typical for processing. I called at the end of 12 weeks for a status, and they said 12-16 weeks.

I asked them "So when I call at the end of 16 weeks, are you going to change it to 16-24 weeks?". The lady responded "I'm sorry sir, everyone in America is buying houses and we don't have the manpower to process all of these requests".

Man, I really hope the government takes on anything like Healthcare... last thing I want to be told is... Sorry, the waiting period for a checkup is 48 hours, then when I come in they say... sorry, it's 5 business days... were a bit busy here.

In response to "Just wondering..."

We closed on our first home on March 27. Due to a tax prep error, we ended up amending our 2008 return to claim the credit. They received our amended return to include the credit on April 9 via mail. It takes 8-12 weeks to receive a refund due to an amended return. Our 12 weeks was up on July 2. After two calls to the IRS, they said that it's still in processing and has been "reassigned" to another individual which causes additional delays. I was told to check back in on July 31 (tomorrow).

I hope it doesn't take you as long as it's taken us. Today is week 16 after IRS receipt and we're eagerly anticipating that check arriving.

Best of luck!

Not sure if I qualify for 8k tax credit

In my mind, I have never owned a home. I married in 2006 to a man who owned a home. I was never added to a deed, mortgage, title, etc. In 2007 that home was sold, I never signed off on anything as I was never listed on anything. The next home was bought solely based on husband's income, I was never listed on the deed, mortgage, title, etc. Actually, all ppwrk was noted as 'John Doe, a single man' Yes, the ppwrk was done incorrectly, and never corrected. I divorced in 2008. At time of divorce, divorce decree noted ownership to husband and that I was never listed on any property info.

So, in my mind, I never owned a home, right....However, we filed jointly for 2 years. I am wondering if that will prevent me from qualifying.

Why some cases take longer than others...

I'm wondering.. for the people who have waited for over 12 weeks.. or the people who have gotten it in much less...

What was your situation? Were there details they would have to look into like confirming that real estate tax in prior years returns was rental income, or the house of a parent, etc? Anything on your return in the past 3 years that is at all mortgage related?

I am wondering if the cut and dry cases get processed any quicker.

My purchase price was

My purchase price was $62,000 so the total return was less than the $8000. They are sending the check tomorrow, which is less than 5 weeks from the date that I sent the amended return in the mail. I wonder if it wasn't flagged because it was a low purchase price?

For those of you who are waiting, it looks like you will be paid interest for the time that you've been waiting since your purchase date. I only waited 5 weeks and my interest is just under $40.

I wonder the same thing

We just moved into our brand new house on May 26th our neighbors closed a couple weeks after us around the 1st week in June. We filed our amendement on 2 June and IRS says they received it on 5 June. Our neighbors just received theirs homebuyer credt on Sat (24 July). I'm not in dire need of the money nor am I gonna bash the govt because I haven't received my free money yet but I just don't get it. How does this work? 5 weeks for one and a very long time for others. We're at 8 weeks now.

19 Weeks and counting

I am at 19 weeks now and according to the IRS the person my amendment is assigned to has not even looked at my amendment yet. So for all I know, there could be an error in the return and I'll have to fix it and wait another couple months. Hell, I may as well have waited until I filed my 2009 return, probably would have been faster. And no, I have not yet heard of anyone saying "Yes, I got my credit."

$8K Tax Credit

I'm in the same boat! I mailed my amendment on 5-11-09, and the website still says they don't have any information for me. When I called the IRS, the lady said it may take up to 16 weeks!! In the meantime, she advised that I re-send the admendment. What a joke!

Do not RE-SEND your amendment!

I was told not to re-send it or you will wait indefinitely.

Said if they don't receive it after the 12-16 weeks are up then send it in again.

We mailed our amendment in on May 22nd they started processing it on June 1, 2009 and said our 16 weeks is up September 26th, I believe, then said if we don't receive our money by then contact them back.

They did not say how much or that interest would be paid.

Website

What website are you going to to figure out where your return is at??

You can't check amendments

You can't check amendments online, you have to call them directly.

What now?!

I filed mine, waited about 5 weeks to call on the status (July 27), only to find out they had had it since July 1st and the amended return had been "accepted, but no changes were made and no rebate had been issued." Thanks for not telling me sooner, jerks. I could have had this fixed weeks ago. Anyway, that's all the rep could tell me, which was disappointing. She didn't know why it was accepted with no changes made, and the best advice she could give me was to call the CPA that prepared my taxes, like they can read the mind of the IRS. Makes no sense... if it was rejected, they would send a letter... if I didn't qualify, they would send a letter... no letters, means the rebate should be on it's way!!! Idiot. Anyway, I had my CPA call, and whomever she talked to said that it had indeed been rejected, but wouldn't tell her why... just that a letter was on the way to me explaining it. We have both been over EVERYTHING and all my paperwork is correct and I meet all the requirements for the credit. I am also getting irritated because the IRS says the paperwork was put in the mail 10 days ago... but I still haven't seen anything in the mail. I'm so frustrated. As a first time home buyer, I really depended on that money to get myself back up on my feet after buying the house. I can't sit on bean bags forever (jk).

Hi I was wondering if you

Hi
I was wondering if you have received a letter yet and possibly what it may have stated as to why it was rejected? My husband and I seem to be having the same problem. thanks

Bought in April

What number did you call too see the status of your credit? I bought my house at the end of April and amended them then also. I still have not received the check and im wondering is there a way to find out the status?

Status of Tax Credit

Did you happen to find out the number or website to check the status? I've been searching without much luck.
Any information you can provide would be helpful!
Thanks,

What if I owned a home within the past three years.

My name was on this home because I helped my mom get it years ago but I didn't live there. Do I qualify since I just baught a new home of my own in June 09?

I keep hearing about all

I keep hearing about all these people that are still waiting on their checks to come in the mail.... but has anyone actually RECEIVED a check in the mail after filing an amendment? I am starting to think this is a big scam. If you have actually received your amended return please let me know how long it took and if you had any problems.

I RECEIVED MY CREDIT!!!

Finally! It took exactly 8 weeks from the date I filed my amended return (June 1). Also, in addition to the $8,000...I also received $79.29 in interest in the same check. I hope you receive your check soon! I've heard some people say up to 14 weeks.

Congratulations! Glad

Congratulations! Glad tohear you got interest as well. My amended return was received by IRS on 5/11/09. I was told on 8/4/09 that it was 'being processed" and tthe "new" processing time is 16 weeks! Ugh!!

Amended return

We amended our return for the tax credit on April 6th and they recieved it April 15th and it was OK'd by the IRS. STILL no return. It's been 14 weeks. We've called to check up on it. They said that it's cleared and ok, but not sent out. So the lady that I had talked to said that she'll put in a rush notice for the check. She said that it'll perk up their ears but they have 30 days to answer the notice. I told her that they have 2 WEEKS not 30 DAYS til the deadline. This is ridiculous. We're so happy to have a roof over our heads and are happy in our lovely home, but seriously, the government needs to stop making promises that they can't keep.

Thank You

Thank you for leting us know that your received your rebate. It restores some (a very small amount) faith that we too shall get ours. They confirmed ours was received May 8th but then we received it back in the mail a month ago advising we where missing the last page (because we filled it out on turbo tax, printed, and mailed. Turbo Tax omits the last page when printing) We sent it back the next day so hopefully that will not hold it up. IRS did confirm that they received the corrections 3 weeks ago.

Thanks again.

1st Time Credit

I filed back at the beginning of April and still haven't received anything yet. I can't wait to get the money, and still haven't received anything yet. I have called the IRS occasionally (probably only twice) just to check the status. The way I look at it, is it is free, and I could have "not" gotten it, so I'm being patient.

$8000 tax credit

We can meet the November deadline for ownership, but the home is in disrepair and won't be ready for occupancy until spring 2010. Is that a problem? Thereafter it will be our principal residence.

occupancy

you have to occupy the home by 12/1 to qualfy...

Nope, it's when you first

Nope, it's when you first reside in the home and it becomes your primary residence. We bought a home in need of repair and just moved into it in June. Just have to wait and see if things move faster... that would be great. Or if you can move in a little early.... or if the deadline gets extended again. good luck!

I believe that the closing

I believe that the closing date is what matters when it comes to the tax credit, so if you close before December 1, 2009, you will still receive the credit check even if you spend a few months fixing it up.

in response

No, there is actually a place on the form to put the date when you first resided in the home.

Haven't received money

We sent our amendment in in the first week of May and haven't received anything. Now they are saying they did not receive it until June 22, although we sent it overnight signature and have the receipt. They are saying processing may now take up to 16 weeks, instead of 12 weeks. I feel like I've been scammed. I hope we get the money soon. If you are buying a house, don't count this money in the bank too soon because it takes a LONG time to come. Someone needs to get on the IRS seriously, because its not right to play with people's money.

HOME REBATE MONEY

Well I sent my new home tax amended return in March and the IRS said they have not received it. So I sent it again last week. Now I need to wait another 12 weeks or so. Man that sucks. I could really use the money.

Dude its not really even

Dude its not really even your money...at least not until you get it; don't act like like you earned it...besides its free government money. Don't have a heart attack and stop crying. Everyone else that bought a house is in the same boat. Grow up

to Dude its not really even.

to Dude its not really even. Reality check it is our money who do you think funds the governement, oh yeah the TAX PAYER. so really all government money to some degree is ours. And i am more than ready to get a little bit of what i pay in every year back. been waiting since the first of may and still nothing.

@DudeItsNotEvenCheck your

@DudeItsNotEven

Check your facts before you spout off like a turd fountain.

In law there is a theory of recovery called "detrimental reliance" and if the American taxpayers are buying houses and, in the course of conduct, detrimentally relying on the government's promises, then they have every right to be outraged.

The funny thing is you come in with blazing guns like you're the voice of reason when in reality any educated reader would laugh at your simplistic view.

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