$ 8000 Refundable Tax Credit for First Time Homebuyers

Update (11/10/09): The $8000 tax credit for first-time homebuyers was extended through April 30, 2010 and more people are included, including a $6500 tax credit offered to homebuyers who have lived in their current residence at least five years and who want to “trade up” (buy a new primary residence).

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Original post:

President Obama just signed the economic stimulus package in Denver, CO which includes a gift for first time homebuyers– $8,000 (or 10% of the home’s value, whichever is less) on their 2008 or 2009 taxes.

Here’s the skinny, from CNN:

  • Refundable: The credit is refundable, meaning tax filers see a refund of the full $8,000 even if their total tax bill – the amount of withholding they paid during the year- was less than that amount.
  • Purchase Date: To qualify for the credit, the purchase must be made between Jan. 1, 2009 and Nov. 30, 2009. Buyers may not have owned a primary home (lived in it) for the past three years to qualify as “first time” buyer. They must also live in the house as their primary residence  for at least three years, or they will be obligated to pay back the credit.
  • Paperwork: Applying for the credit will be easy – or at least as easy as doing your income taxes. Just claim it on your return. No other forms or papers have to be filed. Taxpayers who have already completed their returns can file amended returns for 2008 to claim the credit.
  • Income Restrictions: To qualify, buyers must make less than $75,000 for singles or $150,000 for couples. (Higher-income buyers may receive a partial credit.)

Have questions about the $8,000 tax credit? Ask ‘em in Zillow Advice.

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