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

Filed my Second Amended Return 3 Weeks ago... STILL NOTHING

Filed my Second Amended Return 3 Weeks ago... STILL NOTHING

What in the heck is going on here? I got a tracking number and they said they never got it, I CALL BS!!!

You guys are right, if I OWED THEM money, They'd make CERTAIN they got theirs...

I'm Calling my congressman.

$8k waiting

If we owed the IRS the same money you know damn well they'd freeze our accounts and just take it from us no matter our life situation, so what's the difference when it comes the other direction? We bought our home the first of April and sent the amendment in right away as well. They claimed we would have the check within 8-12 weeks EVEN telling us two weeks ago we should have it before the 12 weeks is up. Now the time is up and when we called today they're saying another 8 weeks as they are "just now starting to look at it."

It's a simple amendment with nothing fancy and either way since we don't owe money we'd get the full 8k anyhow. They need to cough it up so I can go stimulate the economy! ;)

Hes not crying, like

Hes not crying, like everyone else he wants HIS money. And yes I said his money. It dosent matter if the goverment put the credit up or not... For some the 8,000 was a small part of the reason they decided to buy this year.....Before you say anything stupid, remember i did say "just a small part"........Hell even I would like to know if they even got my dang amendment...I just find it stupid for the IRS, not to even note in the system as received when they get them....At least that would cut down on some of the phone calls they get from people calling every week to check.

Re:Dude

Dude, It is our money and that is why many of us bought these POS homes, because the govt said they would give us this money to fix them up. It really sucks to sit out on my screenless front porch and get chewed up by mosquetos and try reattaching the toilet seat everytime it falls off while you are siting on it.

I would be happy if they would just stop giving everyone the run around and give straight answers. Oh, last time I called they said I was selected to do a survey on their service roflmao. Like I was really going to tell them they suck. Then the next time I called they would have said, oh the wait time is now 24-52 weeks.

2009 Tax Credit

I purchased a home in 2008.as rental property. We have been living in my mother's home since 2005..Do my husband and I qualify as first time home buyers since the house I bought in 2008 is a rental and we have not owened any other home in 3 yeasrs? My husband is purchasing a house this month to be used as our primary residence. I would like to help my daudgter buy a home by co-signing a loan. Will my daughter qualify to recieve the tax credit if my name is on the loan? What about the deed?

Being Taxed On the Credit

Iam currently in the process of buying my first house and I heard that I might be taxed on the 8,000 dollars as thouigh it was income? Does anyone know if this is true or not, I just dont want to get my money, spend it, and then find out I owe the damn IRS money in a year.

Taxes on Credit

You won't be taxed on the amount of your credit. You will be taxed on any interest included with your credit.

First time homebuyer credit

i have a question if i am married and flied joint 2008. And my hubby wants to buy a house in just his name can he do it? Will he get the tax credit he is a first-time homebuyer? help

FOREVER

I filed my amendment on April 24th, 2009. It is now July 23rd, 2009. We still have not received our check yet. All this freaking government talk about needing to boost the economy but they surely BEAT around the freaking bush about getting money out there to spend, don't they?

where's my money

closed on my house early may-
not received my stimilus money
when can I expect it?? have things to purchase!!!

Same here. We applied

Same here. We applied towards the end of April, as well, and are still waiting. I hope it won't take too much longer!

I applied in March and still

I applied in March and still haven't seen a check! Now I am being told to expect to wait another 30-45 days! So, don't expect it anytime soon.

HELP

I am a first time home buyer and was planning on buying my grandmothers condo, at market price! Why do I not qualify for the tax credit even though I am playing the same as what anyone else would be??? Can anyone explain this? Is there a way around it???

Conventional loans vs. FHA loan

My husband and i are pretty sure we qualify for the tax credit. But we aren't sure if we can do a conventional loan or if we have to get an FHA loan. Does anyone know the answer to that?

Conventional, VA and FHA

Conventional, VA and FHA loans are qualified for the credit.

Wasn't married then, but married now

Okay my husband and I just got married in April and just bought our new home. We are both first time home buyers, and from everything I have read are eligible for the credit. We bought the house together so both of our names are included as purchasers. We were wondering since we filed separate last year since we were not married how we could amend our return and get the full $8000 back or could we even do it at all or should we just wait until this years tax return and file it then. I've searched and can't find anything answering my question.

Please help!

Amendment

I've looked over the IRS site and can't find anything that specifically answers this either. However, since you both filed separately it stands to reason that you both could file an amendment and each claim half of the credit (4k). Then be prepared to wait.

First time home buyer's tax credit

Every website i have been on with the same question HAVE ANYONE RECEIVED THE FIRST TIME HOME BUYERS' TAX CREDIT CHECK i get the same answers STILL WAITING. I am at 14 weeks and everytime i call and speak with a representative they tell me that they are still in their processing time limit which just went to 16 weeks the week of July 13th when I was at 12 weeks. I also was told that the representatives that we speak with over the phone are just answering calls for the irs. I would love to hear from anyone who has filed an amended return and actually received a check, letter or something from the irs.

I just got off the phone

I just got off the phone with them, they told me the same thing, i filed beginning of May. I spoke with a rep beginning of July, he said you will hear something middle to end of July. It's now the end of July, I call them back, now they say you'll have to wait till end of Aug. This is not just money I want to spend. This is money that I NEED TO MAINTAIN MY NEW INVESTMENT! How do they expect to cut down on foreclosures if the IRS is jerking everyone around?!

My Too!

I Amended my return on 05/07/2009. Every time I call I get the answer that it is not received. I love putting things in the governments hands. They really know how to take care of us. Cant wait till they run our health care and my medical procedure is on wait for 8-12 weeks, wait no just kidding its really 12-16 weeks. Idiot IRS.

not received...

If they are saying they have not even RECEIVED it three months later... you need to re-mail it.

Tax Credit

Just stumbled across your page. I was trying to figure out how long people have waited for their Tax credits. A couple at our church filed at the same time we did and received it in within 12 weeks. We received a letter the same week saying we didn't sign the forms. So I signed and sent them back. Now I am wondering if we have to wait another 16 weeks!? Anyway, some people have gotten theirs and we would have if we would have signed the stupid amendment forms.

1st Time Home Buyers Credit - Amended Return

My husband and I closed on our first house on May 8th, 2009 and promptly sent in the amended return on May 11th. I have called the IRS 4 times now and it is still not showing up in their system - - it has been over 10 weeks!! I know I have read that it is taking anywhere from 12-16 weeks but I guess we are just concerned that the return isn't even in their system. They said to keep calling but they couldn't advise us to resend the amended return until the 16 weeks are up which would be at the end of August. HELP!! Should they at least have it in their system so someone could start looking at it? We are so frustrated that no one can tell us where our return is at. Is anyone else experiencing the same thing? Now I am scared that they lost it and we will have to reapply!

I am in the same

I am in the same situation!what i am finding so frustrating is that i have called the irs 6 separate times,and have been given a different answer each time.The first person explained that it would take anywhere from 12-16 weeks,but please call back.the next time,i was told it should at least show it was received by the third month,and i should mail it in again,certified mail.......when i called yet again after my accountant told me to not mail it in again,to be patient,they told me to just wait..........i am all for being patient,but I would hate to wait 16 weeks,only to find it was never received,then have to start this process all over again. I am trying to understand how busy they must be with this flood of amended returns,but they should get their information straight.Oh,my accountant did say to include the settlement papers from your closing when you mail in your amended return,apparently some of her clients are getting requests from the irs for them,cant hurt to give them all the information up front.Good luck everybody!

1st Time Home Buyers Refund

I'm just wondering who you call to find out the status of your return? We
filed in May and have yet to see anything. SH

update

I called to check my status today,and i was informed my check would be mailed next friday,august 28, with the accumulated interest.I am hopeful,but reserved at this point,I am sort of expecting it to get lost in the mail or something,but I thought i would post all new info i get in the hopes it can help someone else.I will sure let you all know if and when i receive it! I will say the only bright side to not getting the money right away,is my husband and I have really had time to see what is a want and what is a need,so I think the money will be spent more wisely than it would have back in may.good luck everyone!

check came!!

the check finally came yesterday with 100 bucks interest,they said they would mail it on august 28,so it got here very quickly (yes,i am aware of the irony that after waiting since may i said quickly).Hang in there everyone!!

Lost Amended Return?

I'm in an almost identical situation--only 1 week longer than you now. They told me not too resend it as it could slow the process further if they found 2 returns at a time, and they also said that they don't keep records like they do with regular tax returns. So you can't check it online, they don't record when they get it, when it will be processed, etc. I was wondering about it getting lost too, but they just said be patient, although I'll have it in the bank about the time they have any record of it. I don't know why it's not the same process and paperwork as the regular returns!

Return Filed Electronically-Still no $8000 refund

Bought house on June 6th, I efiled my return the next day. By June 9th it was accepted by the IRS. Was expecting refund to include the first time homebuyer credit by June 17th direct deposited into my bank account. I did not receive it.

I got a letter from the IRS saying that they are reveiwing my return, not to send anything, but if they need something they will ask for it within 3 weeks of June 29th.

Was told that if within 3 weeks of June 29th (which was July 22nd) I have not gotten a letter from them asking for additional information or have not received my refund, to call them. Well July 22, 2009 has passed. I did not get another letter or my refund. I called them , they gave me no information.

I know amendments were taking 12-16 weeks, but I thought efiled returns were faster.

Has anyone who efiled their return and claimed the first time homebuyer credit, actually got the $8000?

Also have condo qustion

i purchased a condo in my name only in 2006, put up most in cash and took a small home equity loan for the rest. My wife and I just purchased a house this year, April 2009; in which I took out a mortgage for. Would this purchase count as first time home buyer because it is my first mortgage. Or does it not count because of the loan on the condo.
Thanks

Eligibility

If the condo has been your primary residence you won't qualify for the credit.

Senior Citizens Left Behind

My wife and I have a small 1200 sq. ft. home that we bought and paid for 37 yrs ago. it is now old and in need of lots of repair. Alas, we too would like to have a home buyer credit for a newer, bigger home. We do not understand why senior citizens do not qualify for a credit because most of us "baby boomers" have never, ever, ever, had this kind of opportunity to get into a better homewith a government stimulus credit!. NEVER! Of course, our home is paid for, but we worked hard all our lives, paid all our bills, didn't file for bankruptcy, and we purchased a modest home, at that time, that was within our financial capabilities. Now, only the "young" folks and the "renters" are the targeted market for what is called "1st time home buyers". This program will also, fall on it's face, because we all know that "renters" and "young" people today are too "credit-minded" and are in that kind of life style, just because it is their "kind of life style" which the financial system of today and the banks have taught them!

It greatly saddens my wife and I that after working hard all our lives, being responsible, and living, within our own financial needs, in our small, now much older home, for all these years, we have now, with this stimulus package, been excluded from qualifying as a 1st time home buyer just because "WE OWN OUR HOME" AND BECAUSE WE HAVE BEEN RESPONSIBLE?

WE ARE THE STABLE ONES IN THIS DOWNTOWN ECONOMY AND YET WE HAVE NOT BEEN CONSIDERED!!! IN FACT, WE HAVE, QUITE SIMPLY, BEEN FORGOTTEN!

"Seniors Being Left Out"

I have to point out as a first time home buyer myself, that I am purchasing a home from a senior who puchased the home over 40 years ago. She is making well over a $300,000 profit on the home, well more than the $8000 tax credit that I will hopefully receive to help out with having to pay so much for a home. Maybe you need to re-evaluate the value of your home and then you'll see that you, too, are sitting on well more than the $8000 first-time home buyers are receiving right now.

OFFENDED

It greatly saddens me that you play the poor me act. You have what you need, and after 37 years of owning your home are you saying you haven't built any equity or qualified for a loan yet to buy your own NEW house? Have YOU saved any money, or are you living off the governmentt? And honestly, do you really NEED a bigger house? I am a responsible 24-yr-old wife and mother, and because I paid for everything I own up front we don't have as much saved up. So yes, I think I damn well deserve a first-time home buyer credit. We both work full time! WE haven't gotten any handouts or Medicaid. So don't overgeneralize, thank you. Oh, and I have no debt and no credit card issues.

Just look at it as an

Just look at it as an advance on the Social Security/Medicare us young whippersnappers will never receive. Lets make a deal....If all old people pay for their own healthcare, then they can qualify for this credit.

Wow the nerve!

I cannot believe what I have just read here...did you actually think about what you wrote before you submitted it???? I am a first time home buyer and I did qualify for the package and being on the other side of things I am completely offended that you have the nerve to write something as idiotic as this!!! Please Mr. and Mrs. "senior citizen" get off your pitty pot and be greatful for what you have!!!!!!

Stop Your Complaining

Sir, what is the problem here? You ARE NOT a first-time home buyer! You said it yourself you and your wife bought a home 37 years ago and it's paid off, you live there and it's your primary residence, so what exactly is the problem? You already have a home, this stimulus package is targeting people who are NOT IN ONE.

You want a special tax credit just because you're a senior citizen? How is THAT fair and non-discriminatory?

If you are as financially responsible as you claim, you should have the funds saved and readily available to make the necessary repairs to your bought-and-paid-for home -- it's common sense that you need to put money away for repairs and maintenance; surely after living there for 37 years you should have foreseen this.

Seeing as you currently do NOT have those funds on hand and are complaining about an $8K tax credit, I assume you would take out some sort of loan for a "newer, bigger" home, which doesn't exactly sound fair or financially responsible to me either -- why would someone at such a "late" stage in life want to do this? Would you plan to WORK to pay back that loan? Or just pass away owing money to the bank? How is that being financially responsible?

Why are you Complaining Senior Citizen????

Mr/Mrs Senior Citizen,
Why are you complaining? You own your own home. The program, I think,
was designed to help stimulate the housing market/economy & assist 1st
time home buyers...You should be GRATEFUL...many do not have what you
have.....

HELP! Borrowed down payment from friend

My wife and I have been approved for our first house loan around 180k at a local bank. We are strapped for time with a contract because my fha and conventional pre approval letters both fell through after they saw my tax write offs. The in-house bank loan ended up being the best option because they know us. We are closing very soon. I have a friend who is well off and paying our down payment of around 10k. My question is will we get the 8000k if the down payment is going to be placed in our account from his? Is it OK for the down payment to come from a friends income and not my income? If not how do we get around this to get the credit?
PLEASE REPLY

Your down payment, if given

Your down payment, if given to you, must come from a parent or close relative of the like. And it has to come from a liquid asset; in other words they can't get a loan and give you the money. My understanding is that you cannot use money from a friend for a downpayment

Downpayment

According to federal tax laws anyone can gift anyone $12,000 in 2009. But for some reason money used in FHA/VA loans must come from a relative.

So have your friend gift the money to your parent/sibling/grandparent and then have your parent/sibling/grandparent gift the money to you.

You will have to fill out paperwork showing that the person gifting you the money can actually afford to do so-AKA it has to have been liquid-no loans, credit cards, etc.

Gift

I believe you can receive up to 10k as a gift tax free. The credit is going to be based on who is on the deed of the home and living in it for the next three years. I don't think the down payment will be an issue. But it may be worth the $$ to consult with a tax professional first.

buying first house but will not own the land house will be on

My parents own the land I will be putting my house on.....I am buying my house myself and am a first time homebuyer....never owning a residence in my name....I will not be purchasing the land...would I qualify for the first time homebuyer since I will be paying for the house myself even though I will not own the land the house will be on?

will i qualify

My wife and i bought a mobile home in may of 08 for 2500 cash no mortgage or loan of any kind. we just sold it in june of 09. would we qualify for the tax credit if we bought a house this year. and why?

That would actually depend

That would actually depend on where it was placed. Was it placed on property you owned?

if u had the deed with ur

if u had the deed with ur names on it, no u will not qualify for this tax credit, u are considered as a pervious home owner, now on the other hand if there is no record of u guys owning the moble home, it can be clamed but it would be unlawful of so to do.

Going on 20 weeks amendment

Going on 20 weeks amendment for first time home buyer. Has taken this long for anyone?

Don't hold your breath

I'm going on 13 weeks and was advised that it could take up to 16 weeks. I have not ran across anyone who has actually received a check yet so don't hold your breath. After all the waiting it can still get sent to auditing and then that can add on more weeks... or months. I am just gonna sit back and wait now.

Yes, I am in the same boat

Yes, I am in the same boat as you! I am at 17 weeks processing and lo and behold they waited until week 16 to forward my return on to auditing. So now I was informed that I will be waiting another 30 to 45 days. Imagine that! I just don't understand why they leave these returns sitting on a desk for 16 weeks and then decide to do something with them. People are waiting here! Have you contacted them yet? Maybe they are doing the same with yours.

OMG I just found out today the SAME thing!

I filed in June, and here it is mid october..16 wks or so later and just NOW I find out they are putting it for review and IF it goes for audit it can take an additional 180 days. She said yes obviously there was something questionable on the return, I said questionable?? It was a first time home buyers credit admended return that was filed through H&R BLOCK for pete's sake. I think its just a stall tactic to wait to give you the money because they are being bombarded by so many admended returns ugh. Its just utterly ridiculous, I could sooo use this money right now because my husband's company just claimed bankruptcy and he's been out of work ($70,000/yr job) since like 3 wks after we signed on the dotted line! LIFE ugh.

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