$8,000 First-Time Homebuyer Tax Credit
New Stimulus Plan
This Article is Out of Date
The Stimulus Plan was signed into law by President
Obama, containing a new tax credit for first-time
homebuyers. Essentially, first-time homebuyers within
certain income limits who purchase a home in 2009 before
December 1, 2009 will receive a tax credit of up to $8,000.
The program is similar to the $7,500 tax credit which
applied to home purchases made in 2008 after April 9.
Who qualifies for the credit programs?
While the Stimulus Plan was still being debated, the
Senate version originally included a $15,000 tax credit
for all homebuyers. To lower the cost of the Stimulus
Plan, the final version of the Plan contained this smaller
tax credit, and this tax credit is applicable only to first-
time homebuyers.
To qualify for these programs:
- The purchaser (and the purchaser’s spouse) may
not have owned a home in the three years prior to
the purchase date of the home.
- Single-family homes qualify for the program.
- The home must be the primary residence.
Both tax credits are subject to the same adjusted gross
income limitations (full credit for AGI less than $75,000
single/$150,000 joint, phased out for AGI up to $95,000
single/ $170,000 joint).
What are the credit amounts?
The amount for either credit is the lesser of 10% of the
home purchase price or $7,500 or $8,000, as applicable.
Do I have to repay the credits?
While a purchaser still owns the home, the $7,500
credit must be repaid in equal payments over a period
of 15 years, starting with the 2010 tax filing. The $8,000
credit will not need to be repaid. Again, the $7,500
credit must be repaid, while the $8,000 credit does not!
Upon sale of the home, any portion of the $7,500
credit not yet repaid is due in full. No portion of the
$8,000 credit is due upon sale of the home, if the home
is owned for more than three years. If the home is sold
within the first three years, the full amount of the
credit is due upon sale.
The $7,500 credit was not available to any purchaser
utilizing state/local revenue bond money to help
finance the home purchase. There is no such restriction
on the $8,000 credit.
Will I need to claim the credits on my taxes?
Under both the $7,500 and the $8,000 programs, the
credit will be claimed on the purchaser’s income taxes.
Any amount in excess of taxes owed will be refunded
to the purchaser.
Additional information about the tax credit can be
found on the websites of the National Association of
Realtors (www.realtor.org).
If you are considering a home purchase, I will keep you alerted to interest rate changes.
I continually monitor rates. For clients interested in a new home purchase or refinancing, I alert them of interest rate changes so they are ready at the best time to lock in your mortgage rate.
My consultation is always free and I want to make sure your questions are answered. Please call me today to discuss your home financing: 512-293-1239 (Cell) and 512-617-5636 (Office).
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TDHCA 90-Day DPA
$8,000 First-Time Homebuyer Tax Credit for Down-Payment and Closing Costs
Overview of the $8,000 tax credit available to first-time homebuyers through December 1, 2009.
"The Texas Department of Housing and Community A airs
(TDHCA) has released a Down Payment Assistance Program
called TDHCA 90-Day DPA. This program allows a rst time
homebuyer to monetize the $8,000 tax credit and apply it
to the down-payment and closing costs."
Here are a few...
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