Lokesh Nagpal asked:
There are a host of financial incentives provided by the federal government to encourage people to purchase their own home. The most important and biggest of these is the one included in the Worker, Home ownership, and Business Assistance Act of 2009. In accordance with the provisions of this act, an amount of USD 8000 is extended as a tax credit amount to qualified first time home buyers. It is big monetary benefit to the first time home buyers since one does not have to repay this amount until and unless the property is sold or is not used as principle residence of the beneficiary who claimed the tax credit.
What are the necessary conditions to be fulfilled in order to be eligible to avail this tax credit? In accordance with the IRS definition, a first time home buyer is a person who has not purchased a residence during the immediate three years preceding his purchase. Income levels of single buyers and married couples have been stipulated above which the tax credit is not available. For properties purchased between the periods Jan 1, 2009 to November 05 2009, the maximum income level of a single buyer has to be less than USD 75,000 and in case of couples who are joint holders, the income levels cannot exceed USD 150,000. Similarly for sale transactions executed from November 06 2009 to April 30, 2010, maximum income level could be USD 125,000 and USD 250,000 for single buyers and couples respectively. You can file for availing a joint credit only in case either spouse has not purchased a home within the last three years. The couple still has the option of taking a credit by purchasing the house as a single buyer in the name of the spouse who has not purchased a house in the last three years.
Some important points that you need to note about the first time home buyer credit include the fact that the amount of tax credit available depends upon the property price The tax credit available equals ten percent of the property purchase price with 8000 USD being the maximum amount that can be claimed. The other key point to be noted that not all homes purchased would qualify for this rebate. Only those houses with a maximum price of USD 800,000 would be considered for granting home buyer credit. To be included in the list of beneficiaries you have to ensure that you purchase a home by April 30, 2010, sign the necessary contract papers and complete the sale by June 30, 2010 in order to be eligible under this scheme.
The process of making a claim for the home buyer credit is easy. Submit two statements namely the HUD-1 settlement statement and the IRS from 5405 and walk away with a maximum credit of USD 8000 provided you fulfill the eligibility conditions stipulated by the federal government. IRS allows all those people who buy a home in 2010 to file an amendment to their 2009 tax return and stake their claim.
Colleen
There are a host of financial incentives provided by the federal government to encourage people to purchase their own home. The most important and biggest of these is the one included in the Worker, Home ownership, and Business Assistance Act of 2009. In accordance with the provisions of this act, an amount of USD 8000 is extended as a tax credit amount to qualified first time home buyers. It is big monetary benefit to the first time home buyers since one does not have to repay this amount until and unless the property is sold or is not used as principle residence of the beneficiary who claimed the tax credit.
What are the necessary conditions to be fulfilled in order to be eligible to avail this tax credit? In accordance with the IRS definition, a first time home buyer is a person who has not purchased a residence during the immediate three years preceding his purchase. Income levels of single buyers and married couples have been stipulated above which the tax credit is not available. For properties purchased between the periods Jan 1, 2009 to November 05 2009, the maximum income level of a single buyer has to be less than USD 75,000 and in case of couples who are joint holders, the income levels cannot exceed USD 150,000. Similarly for sale transactions executed from November 06 2009 to April 30, 2010, maximum income level could be USD 125,000 and USD 250,000 for single buyers and couples respectively. You can file for availing a joint credit only in case either spouse has not purchased a home within the last three years. The couple still has the option of taking a credit by purchasing the house as a single buyer in the name of the spouse who has not purchased a house in the last three years.
Some important points that you need to note about the first time home buyer credit include the fact that the amount of tax credit available depends upon the property price The tax credit available equals ten percent of the property purchase price with 8000 USD being the maximum amount that can be claimed. The other key point to be noted that not all homes purchased would qualify for this rebate. Only those houses with a maximum price of USD 800,000 would be considered for granting home buyer credit. To be included in the list of beneficiaries you have to ensure that you purchase a home by April 30, 2010, sign the necessary contract papers and complete the sale by June 30, 2010 in order to be eligible under this scheme.
The process of making a claim for the home buyer credit is easy. Submit two statements namely the HUD-1 settlement statement and the IRS from 5405 and walk away with a maximum credit of USD 8000 provided you fulfill the eligibility conditions stipulated by the federal government. IRS allows all those people who buy a home in 2010 to file an amendment to their 2009 tax return and stake their claim.
Colleen
