Select Financial Mortgage Corp for Milwaukee Wisconsin - Do I Qualify for the $8000 Tax Credit?

$8,000.00 HOME PURCHASE TAX CREDIT

Who is eligible to claim the tax credit?

First-time home buyers purchasing any kind of home-new or re sale-are eligible for the tax credit. To qualify for the tax credit, a home purchase must occur on or after January 1,2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the to the property transfers to the home owner.

What is the definition of a first-time home buyer?

The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the home ownership history of both the home buyer and his/her spouse.

For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualify for the first-time home buyer tax credit. However, unmarried Joint purchasers may allocate the credit amount to any buyer who qualifies as a first-time buyer, such as may occur if a parent jointly purchases a home with a son or daughter. Ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer.

How is the amount of the tax credit determined?

The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.

Are there any income limits for claiming the tax credit?

Yes. The income limit for single taxpayers is $75,000; and $150,000 for married taxpayers filing a joint return.

How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?

The most significant difference is that this tax credit does not have to be repaid.

How do I claim the tax credit? Do I need to complete a form or applicaton?

Participating in the tax credit program is easy. You claim the tax credit on your federal income tax return. Specifically, home buyers should complete IRS Form 5405 to determine their tax credit amount, and then claim this amount on Line 69 of their 1040 income tax return. Note that you cannot claim the credit on Form 5405 for an intended purchase for some future date; it must be acompleted purchase.

What types of homes wiil qualify for the tax credit?

Any home that will be used as a principal residence will qualify for the credit this includes single family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats.

I read that the tax credit is “refundable.” What does that mean?

The fact that the credit is refundable means that the home buyer credit can be claimed even if the taxpayer has little or no federal income tax liability to offset. Typically this involves the government sending the taxpayers check for a portion or even all of the amount of the refundable tax credit.

I purchased a home in early 2009 and have already applied to receive the $7,500 tax credit on my 2008 tax returns. How can i claim the new $8,000 tax credit instead?

Homebuyers in this situation may file an amended 2008 tax return witht 1040X form. You should consult with a tax advisor to ensure you file this form property.

Instead of buying a new home from a home builder, I hired a contrector to construct my home on a lot that I already own. Do I still qualify for the tax credit?

Yes. For the purposes of the home buyer tax credit, a principal resIdence that Is constructed by the home owner is treated by the tax code as having been “purchased” on the date the owner first occupies the house. In this sltustlon, the date of first occupancy must be on or after January 1, 2009 and before December 1, 2009. In contrast, for newly-constructed homes bought from a home builder, eligibility for the tax credit is determined by the settlement date.

Is a tax credit the same as a tax deduction?

No. A tax credit is a doliar-for.dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

I bought a home In 2008. Do I qualify for this credit?

No, but If you purchased your first home between April 9,2008 and January 1,2009, you may qualify for a different tax credit. Please consult with your tax advisor for more informallon.

If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?

Yes.

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$8,000.00 HOME PURCHASE TAX CREDIT

Who is eligible to claim the tax credit?

What is the definition of a first-time home buyer?

The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the home ownership history of both the home buyer and his/her spouse.

How is the amount of the tax credit determined?

The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.

Are there any income limits for claiming the tax credit?

Yes. The income limit for single taxpayers is $75,000; and $150,000 for married taxpayers filing a joint return.

How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?

The most significant difference is that this tax credit does not have to be repaid.

How do I claim the tax credit? Do I need to complete a form or applicaton?

What types of homes wiil qualify for the tax credit?

Any home that will be used as a principal residence will qualify for the credit this includes single family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats.

I read that the tax credit is “refundable.” What does that mean?

I purchased a home in early 2009 and have already applied to receive the $7,500 tax credit on my 2008 tax returns. How can i claim the new $8,000 tax credit instead?

Homebuyers in this situation may file an amended 2008 tax return witht 1040X form. You should consult with a tax advisor to ensure you file this form property.

Instead of buying a new home from a home builder, I hired a contrector to construct my home on a lot that I already own. Do I still qualify for the tax credit?

Is a tax credit the same as a tax deduction?

No. A tax credit is a doliar-for.dollar reduction in what the taxpayer owes. That means that a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS.

I bought a home In 2008. Do I qualify for this credit?

No, but If you purchased your first home between April 9,2008 and January 1,2009, you may qualify for a different tax credit. Please consult with your tax advisor for more informallon.

If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?

Yes.

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