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First Time Home Buyer $8000 Tax Credit

May 21, 2009

The American Recovery and Reinvestment Act of 2009 provides a tax credit of up to $8000 to
First Time Home Buyers who purchase a home between January 1, 2009 and December 1, 2009.

The home purchased must settle between Jan 1 and Dec 1 to qualify for the credit.

Who is Qualified to get a credit?

A First Time Home Buyer is defined as anyone who has not owned a home in the past 3 years.

The home must be purchased as the buyer’s primary residence.

Buyers are Eligible if their maximum adjusted gross income is $75,000 for a single person or $150,000 for a married couple. Buyers with more income can qualify for a partial credit.

How much credit will I get?

The Tax Credit is for 10% of the purchase price of the home up to a maximum of $8000. Buyers who have income that is over the limit may still receive some portion of the credit.

How do I get the credit?

The Tax Credit will be received as a refund on the buyers 2009 or 2008 income tax return.

Buyers who have already filed their 2008 tax return can file an amended return to receive the refund as soon as possible.

Buyers should attach IRS Form 5405 to their tax return and report the purchase on line 69 of Form 1040.

Tax forms are available at www.IRS.gov.  Buyers should consult their tax accountant or tax attorney for assistance in filing a correct return.

Does the Credit Have to be Repaid?
If the home is sold within 3 years, 100% of the credit must be repaid at the time of sale. Beyond 3 years the credit does not have to be repaid.

Additional information is available at www.federalhousingtaxcredit.com

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