 So you'd like that $8,000 First-Time Homebuyer tax credit you've heard about... Do you qualify?
There is, indeed, an $8,000 tax credit waiting for all first-time homebuyers who buy a home, and by now you know that the time frame has been extended to April 30, 2010. (You have until July 1, 2010 to close on the home under the new legislation). So if you have never owned a home (or have not owned one in the last three years) you may qualify for this tax credit when tax time rolls around next year. And what's this new Extended Tax Credit about? I'm a current homeowner.
Can I get some of that $6,500 pie? You can if you are buying a home for $800,000 or less and you lived in the home you're vacating for five years consecutively out of the last eight. Both new homebuyers and current homebuyers have to meet the new income requirements, however. Just what is a credit? As opposed to a deduction (which is a reduction in the amount of income which is taxed), a credit is an actual reduction in the amount of tax you pay. If you owe less in taxes than the credit is worth, you get the extra back in the form of a check or direct deposit. Here's an example: next February after the Super Bowl when you sit down to do your taxes you find you owe the IRS $1500 in total taxes for 2008. "Crap" you say, or something to that effect. Then you smack your forehead, say "Hey! I almost forgot! I bought my first house last year!", sink back into your chair, and have another pretzel and swig of beer, smiling. Because you bought that house, instead of you paying the IRS $1500, the IRS pays you $6500! Sweet. There are some conditions, though. Here's the actual Form 5405 First Time Homebuyer Credit which has everything you need to know about qualifying and filing for your $8,000. Call or email me, and we can talk about how to best go about buying your home so you can take advantage of the Extended Homebuyer Tax Credit! (Not to mention great prices and low home loan interest rates!!) 507-317-0177 or jim@MankatoHomesOnline.com HOME |