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

New Home Tax incentive - IRS lack of incentive

I closed on my home April 16, 2009. I mailed my amended return April 21, 2009. I have called the IRS since the middle of June only to be told my return was not showing in their system. In July the system showed my return which was stamped as received April 28, 2009. I call yesterday (7/24) to check the status of my check and was told it was being audited. I can understand that they have to verify this information. But when I asked where I could fax my loan documents to ........ the IRS informed me they would contact me when they wanted these documents. In others words another 4 -12 weeks without my new home tax credit. This is ridiculous. I have the documents and can send them at anytime.... but this has become a control issue with the IRS, who obviously is not concerned with stimulating the economy.

Your IRS Audit Experience

Have you ever dealt with the IRS before?? You do things at their pace PERIOD . . . don't offer to fax information to them . . . They will send you a letter advising you of a day you can miss work and plead your case before an ill tempered, rebate hating, knows you can't fight 'em agent. You will be required to stand face to face with this unfortunate individual, with at least three forms filled out with the original documents from your closing. You are sure to not have everything they require and will have to make a second trip. You may resort to profanity as you leave, but it will be of no avail . . . they know you're at their mercy. Even letters to your senators and congressmen won't help - they are powerless against the almighty IRS.

Tax credit

I would call. We waited 9 weeks and I called to check the status they updated our address but "lost" the paperwork so had to overnight it to them again and included a note with explination and delivery confirmation. Still waiting for it. They are somewhat helpful they can st least let u know if it's getting processed give them a call

irs phone number

Can someone who has actually spoken to the IRS on the matter of verifyiing if they have recieved their first time home buyers tax credit amended return PLEASE give me the number??? I have tried several but can never get to a live person.
Thanks!!!
Nicole

i would really like to know

i would really like to know the number too please!!!!

called IRS today

My husband called the IRS today and was told they are taking 12-16 weeks now to send the returns! We sent ours in on May 4, and as of today are at 11 weeks. The IRS made it sound like a lot of people are sending in returns who do not qualify for the tax credit, and therefore they are having to weed through the faulty returns.

hope this helps!

Building a House

Hi, We are starting a new house. My Fiance will be the general contractor during the time of the construction. The house will be in my name since I haven't purchased a home in the past. We are getting a construction loan in a couple of weeks, that we WILL be closing on right away. Does that qualify us for the $8,000?
We would like to take our time building it. Does it need to be completed by Dec 1, 2009....if we have already closed on the house???

Unfortunately, unless you

Unfortunately, unless you are able to move into the home before the deadline, then no. If it is new construction you are to use the date you first resided in the home. Personally, I'd watch and hope that the deadline gets extended. Also, if you think the house might be close enough for you to live in it, or live in part of the house while it's being finished, that might be something to consider too.

First time buyer following a divorce

My ex-usband and I sold our home in March, 2007. My name was on both the mortgage and the deed. I am in the process of purchasing MY OWN home. Do I qualify as a first time buyer ?

No you will not because it

No you will not because it must be three years from time of title transfer when you sold.

Common Law Marriage and 1st Time Buyer's Tax Credit

I am common law married. Before we were married, my husband owned a townhouse 2 years ago. I have never owned a house before. Can I still qualify for the tax credit or are we subject to the same legalities as other married folk? Is it possible to have him co-sign the mortgage, but not co-own the home with me? Would this help me qualify for the credit as well?

Thanks in advance!

8K Tax Credit

I had a home which I sold this year. Now my wife is buying a home this year. Can she get the 8K tax credit by ammending last year tax return or when we file the tax return next year?

Last year we filed joint tax return.

mailed in amended return not back yet

Hey

I mailed in my amended return 6/8/09 and want to check on it-it's 7/14/09 and I cannot find any info on how to do that. I checked irs.gov and I could not find any phone numbers. Please help we really need the money now to fix up this house we just bought.

Thanks

Amanda

this process can take 12 to

this process can take 12 to 16 weeks befor it would even be in the computer system to check the status here is the number 1-800-829-0582 mon-fri 9am to 10 pm good luck.....

We closed on 26 May and sent

We closed on 26 May and sent in our info on 2 June and I hadn't heard anything. I had been patiently waiting but decided to contact the IRS. They told me that they received our papers on 5 June and the time starts from then. They confirmed that it is now taking 12-16 weeks to process amended returns. Not just individuals seeking the first time home buyers credit. Hope this puts some ease to people's minds who are panicking because they haven't heard anything after a couple weeks.

I mailed my 1040x and the

I mailed my 1040x and the form for the $8000 credit on May 21...we are still waiting.

RE: Mailed in Amendment

Hi Amanda,

Question: Are you expecting a refund? I kinda gathered that from your text. Here is a link that might help you out :
https://sa2.www4.irs.gov/irfof/lang/en/irfofgetstatus.jsp

This is the Where's my Refund? Link to the IRS

That can give you an idea if they have processed it.

2nd: If you want to go visit the IRS in person :

Las Vegas 110 City Parkway Las Vegas, NV 89106

Monday - Friday 8:30 a.m. -4:30 p.m.

Services Provided

(702) 868-5005

If none of this helps, grab a coke and a magazine, and call :
1-800-829-1040

All the best,
Brandon Ferrell

refund

Actually the "Wheres my refund" only works for regular returns not amended returns. http://www.irs.gov/individuals/article/0,,id=200571,00.html.

"Please note: Amended tax return (Form 1040X) information is not available on Where's My Refund.
If you are looking for amended return information, please contact our customer service representatives at 1-800-829-1040."

youve only waited 5 weeks,

youve only waited 5 weeks, it said at a minimum it would take 8-10 weeks and for most people its been taking up to 13 weeks, you probably still have a long time to wait, sorry

I just bought my first home

I just bought my first home and I'm wondering if I qualify for both the 2008 credit (that's really a long term loan) and the 2009 credit?

Qualifying

No, because part of the guidelines for qualifying for either credit is that the home purchase had to be made during a specific time period. Since you just bought your home, you only would qualify for the $8k credit, provided you meet all of the qualification rules. According to the IRS, if you had bought your home early this year, then you could have claimed both.

How is Marital Status Defined

I owned an apartment in NYC since 2003, I then sold this in March 2008 and my fiance and I bought a new apartment in April 2008. This would be my fiances first home and principal residence. I know at that point the only credit is the $7500 "loan" however I'll take it.

My fiance and I got married in May 2008, since we purchased the home before we got married is she eligble for the credit, or do we get screwed because we considered married in 2008, no matter when we got married or purchased a home.

BTW, getting married cost us an extra $3200 in taxes in 2008 due to the marriage penalty... that, along with not taking the credit, is nearly $10K... I love how our goverment and tax code punish certain people because of their religious/marital beliefs... and they think that 2 people who are married should pay more in taxes than 2 single people...

what happened to seperation of church and state?

Separate checks from IRS?

I received my tax refund, but not the $8,000. My taxes were sent with the homebuyer credit form included. Is the $8,000 coming in a separate check or is there a problem? I am definitely elgible as a first time homebuyer.

your 2008 tax refund is

your 2008 tax refund is seperate from the new home buyer tax credit, you have to file an admendment for the 8,000 and get a check in the mail, it normally takes about 13weeks,

Still waiting

I mailed in my ammended return at the end of March, at that time they said it would take up to 12 weeks, I called at 12 weeks and was told they forwarded it on, they have a special office working with the 1st time home buyer tax credit. They also said I should recieve my money within 90-180 days. I am now past the 16 week mark and haven't heard anything.

Cash purchases

I have a client that wants to purchase a home cash with her son but he has not owned a home and she does, can the son get the credit?

Receiving Tax Credit

Has anyone recieved thier First Time Home Buyer Tax Credit before they bought thier home?? And is the tax credit coming in the mail in the form of a check. I heard that there were some people who got there 8,000.00 dollar tax credit before they bought thier home, with an amended 2008 tax return, also i heard it was in the form of a refund check. Can someone answer this question please??

You are not eligible for the

You are not eligible for the credit until you close on the home, so no you should not be receiving it prior to owning the home.

when

Has anyone received their money yet after an amendment and if they did how long did it take?

i was told it would take

i was told it would take 8-10 weeks befor i would recieve the check, its been about 11 weeks now. but ive read on a bunch of websites that most people get it back around the 12-13weeks , so im still waiting.

"Has anyone received their

"Has anyone received their money yet after an amendment and if they did how long did it take?"

Closed March 27th, 2009. Filed amended 2008 return April 10th. Received check from IRS May 18th. Heard it may take longer for some. Hope that helps!

Forever.....

Hi! The IRS received my amended return on March 26 but as of yesterday (15 weeks) I have received no check. I spoke with someone yesterday at the IRS that told me they just got notice that it is taking 16 weeks now for processing of amended returns. At this point, I am beginning to doubt that I will ever get my check. I haven't heard of many people at all getting them yet. It seems that everyone wants to know if anyone had gotten it yet but no one seems to be replying.

My sister closed on her

My sister closed on her condo mid-April and did not have to file an amendment, so she received her $8,000 check right away. I closed on May 1, 2009, filed an amendment, waited past the 12 weeks, and the IRS still had no documentation of me filing. I resent paperwork about 4 weeks ago, and still nothing. I am also worried that I will never see the $8,000. People that filed before taxes were due seem to have gotten their tax credit back right away. These amended returns seem to be taking forever...will keep you posted if I hear anything new. Let's keep our hopes up! We deserve this tax credit!!!

both of my friends received

both of my friends received their check in exactly 4 weeks.. Im on week 12 and still no check.. I filed 2 months before them..

jerked around.

As of today we are at 11 weeks, called and was told that they are flagging most of them for auditing. If they do a audit they have 30 days to send papers to inform me of it and request extra info. I don't know what info but I am beginning to think they are jerking me around, different story every time. This refund is the reason most people have bought this year and I feel it's unfair that they can string us along as they please. I will keep you up to date on the progress, if any.

im still not clear if it's

im still not clear if it's $8000 for married couple and $4000 single person, or $8000 total regardless of marital status.... i meet all other qualifications... single person who meets all qualifications, 4k or 8k..anyone? thank you

I'm still not clear...

The money isn't per person, it's per property. If one person or 5 people buy a house together, it's still 10% or 8k, whichever is less.

You only can claim up to 8k.

You only can claim up to 8k. Doesnt matter if you and your wife are both first time home owners.

If you solely purchased a 80k house you would get 8k back.

if you joinly purchased a house at 80k you would get only 8k (4 and 4)

Non-immigrant

Hi,

I'm non-immigrant working fulltime in US. Can I eligible for this first time home buyer tax credit?

non immigrant

in my view u will be qualifid if u reside 180 days/year for last three year.
means try to see defination resident alien on irs.gov
even if u dont have green card u can still be eligible but just check defination of resident alien. we must be eligible because we do pay all taxes

tax credit

My husband and I are purchasing our first home (first for both of us) from our landlords, who will be holding the mortgage. We live in NY. Do we qualify for the tax credit with a private mortgage? Additionally, he is currently not working and I will claim him on my taxes, we will still qualify for the whole $8,000?

I am building a house soon

I am building a house soon and live in a house that i already own. Since the house I live in now was bought cheap and I never had a mortgage do I qualify for the tax credit for first time home buyers.

If I refinance and add 2 of us to the mortgage,does she get it?

I have a tough question:

I want to refinance and add my future wife to the mortgage before we are married. If we refinance and I add her to the mortgage and deed, would she qualify for the tax credit. We will be married in December of 2009 and will refinance before this.

Hence, we will be filing taxes together, but she will be on the mortgage before we are married.

1.) Will refinancing and adding her to the mortgage qualify her as a "first time" homebuyer
2.) If we get married the same year, but refinance before we are married, are we considered married no matter what when filing the taxes?

Thanks!

First Time BUYER

No. You're not getting a tax credit for refinancing. You already own the home.

Time to get your First time Home Buyer tax Credit

We filed our ammended tax return on March 17th 2009, it's July 9th and we still don't have it. Everytime we call the IRS they say they are still "processing" it even though it is in their system showing a credit is due. Anyways, it's been quite frustrating being we've already spent it when we were fixing the place up.

How long did it take you to get your AMENDED return?

I'm in week 7 of waiting.

I'm in week 7 of waiting. How did you check your status? I have read on other websites that it can take 12-14 weeks.

16 weeks later and nothing

It's been 16+ weeks since we filed and for the past 3 weeks, every time I call, I get a different story. Today I was told that my check will be sent out on Friday, but could take an additional 2-3 weeks. I'm not really sure how it's being sent, but even snail mail only takes about 3-5 days. I'm not sure what's going on, but just be ready for a long haul.

why would it take that long?

why would it take that long? did they expain it to you. they told us 7 to 10 days but never recieved our check.

I'm in the same boat too.

I'm in the same boat too. How did you check their system? Did you check a website? and what number did you call for the IRS??

Thanks for the help.

Tired of waiting.

I am in the same boat as you. Thats a lot of money to be coming in the mail so I have called a few times and have been told the same. Looks like the only thing they get in a hurry for is if you owe them. We are in week 10 and still no money.

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