First Time Home Buyer Credit – Qualifying Criteria and Restrictions
Safiur Rahman asked:
If you are looking to buy your first home in the near future, it is likely that you have heard about the first time home buyer stimulus program which offers you a tax credit of up to 10% on the purchase price of your home (up to $8000) if you purchase by April 30th of next year. You are probably also familiar with the basic qualifying criteria like not having purchased a home as your “primary residence” in the three years prior to your current purchase and being within certain income limits. There are, however, certain lesser known restrictions and exceptions surrounding the regulations that could impact your eligibility. Failing to be aware of these provisions could result in an unpleasant experience with you being denied the credit or required to repay it. Conversely, if you meet certain conditions, the law may make certain exceptions that allow you to receive the credit even if you normally wouldn’t qualify.
Firstly, you must keep in mind that this program is designed to assist genuine first time home buyers who are purchasing a home as their primary residence. House flipping is not encouraged. The law requires that you maintain the home you buy as your primary residence for at least three years following your purchase. If at any point during that period your home ceases to be your primary residence (such as if you decide to sell it), then the credit must be repaid. Exceptions may apply to members of the armed services, intelligence community, and the Foreign Service who are under government orders for extended duty service. Next, you do not qualify for the credit if you bought the home from a close family member such as spouse, parent, grandparent, or child. You also cannot claim the credit if you are a minor or non resident alien. Residents living in the District of Columbia who have claimed the Washington D.C. first time home buyer credit also do not qualify. There is some good news for you, however, if you are a member of the armed services, Foreign Service, or intelligence community serving overseas. If this describes your current situation, then you have an additional year to purchase your home. This means that you have until April 30th, 2011 to enter into a binding agreement and until June 30th, 2011 to close on your purchase.
Although the basic qualification criteria surrounding the first time home buyer credit are relatively simple, the devil does indeed lie in the details. Make sure you avoid disappointments and missed opportunities by doing all your research and staying up to date on the latest developments.
Benjamin
If you are looking to buy your first home in the near future, it is likely that you have heard about the first time home buyer stimulus program which offers you a tax credit of up to 10% on the purchase price of your home (up to $8000) if you purchase by April 30th of next year. You are probably also familiar with the basic qualifying criteria like not having purchased a home as your “primary residence” in the three years prior to your current purchase and being within certain income limits. There are, however, certain lesser known restrictions and exceptions surrounding the regulations that could impact your eligibility. Failing to be aware of these provisions could result in an unpleasant experience with you being denied the credit or required to repay it. Conversely, if you meet certain conditions, the law may make certain exceptions that allow you to receive the credit even if you normally wouldn’t qualify.
Firstly, you must keep in mind that this program is designed to assist genuine first time home buyers who are purchasing a home as their primary residence. House flipping is not encouraged. The law requires that you maintain the home you buy as your primary residence for at least three years following your purchase. If at any point during that period your home ceases to be your primary residence (such as if you decide to sell it), then the credit must be repaid. Exceptions may apply to members of the armed services, intelligence community, and the Foreign Service who are under government orders for extended duty service. Next, you do not qualify for the credit if you bought the home from a close family member such as spouse, parent, grandparent, or child. You also cannot claim the credit if you are a minor or non resident alien. Residents living in the District of Columbia who have claimed the Washington D.C. first time home buyer credit also do not qualify. There is some good news for you, however, if you are a member of the armed services, Foreign Service, or intelligence community serving overseas. If this describes your current situation, then you have an additional year to purchase your home. This means that you have until April 30th, 2011 to enter into a binding agreement and until June 30th, 2011 to close on your purchase.
Although the basic qualification criteria surrounding the first time home buyer credit are relatively simple, the devil does indeed lie in the details. Make sure you avoid disappointments and missed opportunities by doing all your research and staying up to date on the latest developments.
Benjamin
First time home buyer with tax credit question?
chicky asked:
I’m closing on my first house next week and i understand that the tax credit for first time home buyers has changed from $7500 to $8000. Can i receive that money on this years taxes or must i wait till next years filing?
I’m closing on my first house next week and i understand that the tax credit for first time home buyers has changed from $7500 to $8000. Can i receive that money on this years taxes or must i wait till next years filing?
Thanks and wish me luck!
Jessie
First time home buyer tax credit and HUD 100 down payment using the tax credit?
sle7787 asked:
I would like to know if you are a first time home buyer and you are going to use HUD’s $100 down payment promotion, can the first time home buyer tax credit be used towards the closing cost?
Please make your answer in simplest terms because I do not understand real estate or mortgage lingo that well.
Lewis
I would like to know if you are a first time home buyer and you are going to use HUD’s $100 down payment promotion, can the first time home buyer tax credit be used towards the closing cost?
Please make your answer in simplest terms because I do not understand real estate or mortgage lingo that well.
Lewis
do i fall under a first time home buyer?
katie n asked:
my husband and I own a house in upstate NY. my name is on the deed. but I have not signed the loan. If we get a divorce would I be eligible to receive the first time home buyers 8000$ stimulus package deal?
Ruth
my husband and I own a house in upstate NY. my name is on the deed. but I have not signed the loan. If we get a divorce would I be eligible to receive the first time home buyers 8000$ stimulus package deal?
Ruth
Can I use 1040A to claim the First Time Home Buyer tax credit?
HealthyGal asked:
Which line on the 1040A is the First Time Home Buyer Tax Credit located? I know that I need to file Form 5405 with the 1040, but I wanted to know if it was possible to file Form 5405 with the 1040A.
Marilyn
Which line on the 1040A is the First Time Home Buyer Tax Credit located? I know that I need to file Form 5405 with the 1040, but I wanted to know if it was possible to file Form 5405 with the 1040A.
Marilyn
Will my wife be eligible for the First-Time Home Buyer Credits?
di_cassano asked:
I bought a home 2 years ago, the home owner is myself only. If my wife buys a $200,000 worth of home in February, will she be able to claim the $8,000 tax credit as a first time home buyer? Thanks.
Marion
I bought a home 2 years ago, the home owner is myself only. If my wife buys a $200,000 worth of home in February, will she be able to claim the $8,000 tax credit as a first time home buyer? Thanks.
Marion
I will be a first time home-buyer and I don’t know where to start on purchasing or financing a new home?
showstoppper_1 asked:
I have gotten my three credit reports and i took a home buyer education class so where do i go from here
Juanita
I have gotten my three credit reports and i took a home buyer education class so where do i go from here
Juanita
First time home buyer in Pennsylvania – any benefits available?
myspacejunkie asked:
I know that there are programs out there for first time home buyers. The problem is that when I google it, I get a myriad of sites, most of which are “grants” that are not really grants but rather clever marketing tactics used by mortgage companies. Any suggestions?
Diana
I know that there are programs out there for first time home buyers. The problem is that when I google it, I get a myriad of sites, most of which are “grants” that are not really grants but rather clever marketing tactics used by mortgage companies. Any suggestions?
Diana