Rules and Forms in Place for $8000 First Time Homebuyer Tax Credit
By: Diane Tuman, Zillow Content Manager | March 2, 2009
That didn’t take long. Tax credit forms and rules are now in place for those who want to claim the $8,000 first time homebuyer tax credit, which was part of President Obama’s stimulus bill — aka, the massive $787 billion American Recovery and Reinvestment Act of 2009.
Who is eligible for the $8,000 tax credit?
- First-time homebuyers who have not owned a principal residence for three years prior to purchase.
- The home must be purchased between January 1, 2009 and before December 1, 2009 (special note: the final date is December 1 — not Dec. 31).
- Buyers must make less than $75,000 for singles or $150,000 for couples (higher-income buyers may receive a partial credit).
How can I claim the $8000 tax credit?
- You can claim the tax credit on the 2008 tax returns due April 15 or on the 2009 tax returns next year. Or, if you’ve already completed your tax return, you can file an amended return to claim the credit.
- The claim can be 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately.
- Claim the tax credit on your federal return by completing IRS form 5405 to determine your tax credit amount, and then claim this amount on Line 69 of your 1040 income tax return. No other applications or forms are required, and no pre-approval is necessary.
Does it have to be repaid?
- No. Unlike the $7,500 tax credit that needed to be refunded under last year’s Housing and Economic Recovery Act, this does not have to be repaid as long as the home is your main home for 36 months after the purchase date.
More information on $8000 tax credit:
- Stumble it!
- Categories: Mortgages, Real Estate
Comments
43 Comments so far
Enjoy this post? Subscribe to the Zillow Blog feed or get updates via e-mail
Barb on March 24, 2009 7:13 am
Just a question. Do you have to purchase the home first or can you file for the credit and then purchase the home before 12/01/2009?
Roberto on March 26, 2009 11:41 am
If you haven’t filed you can claim it this year as long as you buy this year.
Jeff on March 27, 2009 4:52 am
You must first purchase the home, then apply for the credit.
quy on March 29, 2009 5:58 pm
I already filed my tax, and paid almost $1k for both
federal and state… If I buy a home after April, 15
How can I file my amended tax credit return??? what kind of form??? and Do I need a certified tax preparer for that…. I normally file tax return myself… Please help me to straight out this answer
thank you
ed on March 31, 2009 8:22 am
I am currently renting a home that is owned by my parents. My parents want to sell me this house with owner financing. Do I still qualify for the $8000 first time homebuyer tax credit? My wife and I have never owned a home. We want to settle/close on the purchase prior to 1 December 2009.
Norman on April 4, 2009 6:07 am
If my daughter who now rents from me, buys the house is she elgible since we are related?
phillip r catron on April 9, 2009 6:46 am
we owne a mobile home we are living in now we owne no realistate if i buy a home this year will we be elgible for the tax credit?
Andy on April 15, 2009 11:48 am
I bought a home from my wifes parents. I heard that I am not eligable for the 2009 tax credit because it was from a relative. I paid the amount the home was appraised at (fair market value.) Am I not eligable for this tax credit?
Thanks
Jim Walker on April 18, 2009 10:30 am
I moved to Panama two years ago and am glad. Down here new home construction is free of property taxes for twenty years. For small home owners ($30,000 or less mortgages are subsidized and there is a partial subsidy up to $80,000. Homes here do not require insulation nor heating and construction costs less. So, you get more for your money many ways.
Arlington VA Homes on April 26, 2009 7:59 pm
I really do not see anyone breakingdown my door to do a deal for an 8K credit. Sorry folks. Home calues cna fall more than that in an expensive market.
Christina Viering on May 11, 2009 2:17 pm
Wonder how many people will be rushing to buy homes before the end of the year?
Karina on May 22, 2009 5:01 pm
My boyfriend and I are planing to purchase a home together. He already has a property, this will be his second property but I will be a fist time home buyer do we or I qualify for the First Time Homebuyer Tax Credit?
Teresa Sheets on June 7, 2009 8:57 pm
My father passed away in May. We will sell his house. His grandson wants to buy the house. If we sell the house to him (grandson), will he receive the $8000.00 homebuyer tax credit???????????
Diane Tuman on June 8, 2009 10:54 am
According to IRS form 5405, you cannot be eligible for this tax credit if you buy a home from a related person. Here is their language:
Who Cannot Claim the Credit:
8. You acquired your home from a related person.
A related person includes:
Your spouse, ancestors (parents, grandparents,
etc.), or lineal descendants (children, grandchildren,
etc.).
Here is the link:
http://www.irs.gov/pub/irs-pdf/f5405.pdf
Probably a good idea to consult with your tax planner.
Terry on June 9, 2009 3:36 pm
This is a great topic as many 1st time home buyers are really needing help to buy. First I would like to give comment that the tax credit is being worked out in the form of how they can get this upfront (unlikely but…). Now from what we were told in our meeting is that the gov is looking to have a 3rd party handle this. Could be an asset manager, the lender or??? They don’t know yet on how they are going to work this for the buyer to get prior to closing an escrow (if at all during an escrow). Now for my last two buyers; they closed escrow, went to their tax person and filled the form out and are waiting for their money (from my understanding this amended their 2008 taxes). Now the problem we are going to end up running up against (hope it get’s worked out and doesn’t happen) is sellers (REO homes) are going to see this money going to buyers down payment (if gov works out the 3rd party). Sellers are not going to be so willing to give up a little towards a BCC since again the buyer is receiving funds for themself… Again we pray this doesn’t happen as buyers in situations of good credit and a little money to move need all they can get to close…
Relative on July 3, 2009 12:58 pm
The ‘Relative’ Problem
Any help please!! For the ‘relative’ problem, my ’stepson’ (from 2nd marriage, 23years old) supposedly qualifies as being eligible for this credit but my ‘blood’ son (27years old) does not!! Can Someone please explain this illogic to us ? There has to be a way to address this discrepancy. Please help.
Eve Clavette on July 3, 2009 2:45 pm
My daughter and I just cosigned on a condo for her residence. I own my own home but it will be her first. Is she eligible for the $8000.00 stimulus?
Her income is a whole lot less than 75K and she’s single.
San Diego Homes for Sale on July 7, 2009 9:54 pm
This $8,000 tax credit has definitely stimulated demand among first-time home buyers in San Diego. It is interesting how the red-tag-sale mentality works. Entry level prices dropped $200,000 on average, and then major motivation hits when people are offered a $8,000 tax credit. Maybe it was a combination of factors and a general sense the the time is right to buy a home in San Diego.
r. copeland on July 8, 2009 3:28 pm
i just bought a home in march 2009 and was excited about the credit. we were going to use this money to purchase several expensive items that this home needs(new ac/heater unit, etc.). i just learned that i am not eligiable for the credit because i had a morgage on a mobile home before i made my purchase.
however, the rules state that if you owned a “vacation home” or “rental property” that you still qualified.
must be nice to own rental property and vacation homes and still receive $8000 while small struggling families have to do with out!!!
who made up these rules?!?
steve on July 10, 2009 1:39 pm
what do you do about someone who will purchase the house
and never live there
Real Estate News - New Widget: Do You Qualify for $8,000 First-Time Home Buyer Tax Credit? on July 17, 2009 2:02 pm
[...] throughout the nation and mortgage rates are relatively low. Plus, the government has offered up an $8,000 first-time home buyer tax credit, further sweetening the pot for any first-time home buyer out [...]
Do You Qualify for the $8000 Buyer Tax Credit? | Free FHA Loan Advice on July 21, 2009 11:39 am
[...] government’s $8,000 first-time home buyer tax credit has been a source of some confusion by those who might be eligible, but aren’t quite sure if [...]
Do You Qualify for the $8000 Buyer Tax Credit? | No Closing Cost Refinancing on July 22, 2009 6:39 pm
[...] government’s $8,000 first-time home buyer tax credit has been a source of some confusion by those who might be eligible, but aren’t quite sure if [...]
Do You Qualify for the $8000 Buyer Tax Credit? | Loans and Foreclosure Bailout Lenders on July 22, 2009 6:40 pm
[...] government’s $8,000 first-time home buyer tax credit has been a source of some confusion by those who might be eligible, but aren’t quite sure if [...]
Do You Qualify for the $8000 Buyer Tax Credit? | New Mortgage Refinancing with Bad Credit on July 22, 2009 6:42 pm
[...] government’s $8,000 first-time home buyer tax credit has been a source of some confusion by those who might be eligible, but aren’t quite sure if [...]
Do You Qualify for the $8000 Buyer Tax Credit? | Debt Consolidation Elimination on July 22, 2009 7:03 pm
[...] government’s $8,000 first-time home buyer tax credit has been a source of some confusion by those who might be eligible, but aren’t quite sure if [...]
Josue on July 27, 2009 9:39 am
ok I live in chigaco illinois, and I purchase a Mobile Home in the year 2000 and Im still making payments to the bank, I have to pay rent for the lot where my Mobile Home is parked. Can I qualify for the 8000 tax credit? is my Mobile Home consider a Real Estate property?
adam on July 27, 2009 9:46 pm
Can I file for my credit before I close on a house?
Tammy on July 30, 2009 12:17 pm
hello my name is Tammy Williams we are building a new house. We sold our house in March of this year to build another. It was built august of 2006.(thats when we closed) we should be fine for this tax credit right………….as long as we close by november 30th/09
thanks
joe on August 1, 2009 1:17 pm
I was a first time home buyer in 2006. why can’t i get some free money??? this bill is crap!!! thanks obama for giving my tax dollars away. $8,000 would come in real handy right now. They need to make this bill go back a couple of years so it doesn’t screw anybody out of a much needed tax cut.
Shane on August 11, 2009 5:40 am
I am a first time home buyer and Veterian. Can I still qualify for the tax credit if I use a VA Loan too?
Tammy Cousins on August 24, 2009 10:36 am
Me and my husband are in the proess of become first time home buyers.But we are not quit there yet.We are working on clearing up credit which we are still in process,its taking us some time.We know that we will have it all finishs within the nexts year.My question is, is there some way that we can have the 8000 tax credit put in a holding account for us or do we have to get another loan to clear up are credit sooner.And would that hurt us with purchasing a new home? What do we do in this postion?
Dan Huckestein on September 2, 2009 1:28 pm
My parents intend to sell me the home that I have rented for the last 12 years. I plan to purchase the home from my parents with a conventional loan through a bank. Will I qualify for the first time homeowners $8000 tax credit?
Diane Tuman on September 2, 2009 1:51 pm
According to the IRS, you cannot purchase a home from a close relative and qualify for this tax credit. Here’s the page: http://www.irs.gov/newsroom/article/0,,id=206291,00.html
Here’s the section (second bullet point):
Q. Who cannot take the credit?
A. If any of the following describe you, you cannot take the credit, even if you buy a new home:
* Your income exceeds the phase-out range. This means joint filers with MAGI of $170,000 and above and other taxpayers with MAGI of $95,000 and above.
* You buy your home from a close relative. This includes your spouse, parent, grandparent, child or grandchild.
* You do not use the home as your principal residence.
*
You sell your home before the end of the year.
* You are a nonresident alien.
* You are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any taxable year. (This does not apply for a home purchased in 2009.)
* Your home financing comes from tax-exempt mortgage revenue bonds. (This does not apply for a home purchased in 2009.)
* You owned a principal residence at any time during the three years prior to the date of purchase of your new home. For example, if you bought a home on July 1, 2008, you cannot take the credit for that home if you owned, or had an ownership interest in, another principal residence at any time from July 2, 2005, through July 1, 2008.
tammy velazquez on September 15, 2009 1:38 pm
Will i qualify for the $8000.if im buying a modular home on a owner contract.The owner is not a relitive,and i found it on craigs list,so i didnt even know the seller before i bought my home.Also i am on a lot that i pay rent on each month and im on ssi,and ssd.can anyone answer these questions please?
Eveline haven on September 16, 2009 12:40 pm
If an Uncle is trying to sell, a house,to a nephew, can that person, being the nephew, qualify, for the $8000.00 Stimulus.
Michael on September 16, 2009 5:07 pm
Where do I mail the form for the tax credit once it is filled out? I live in IL
Cathy Dison on September 17, 2009 7:00 am
I’m trying to help my granddaughter out. She just bought her first home. She says she has the paper work filled out for the $8000 stimulus, but she doesn’t know what to do next. They are telling us on the news that new homeowners have until the end of Nov. 2009 to apply for this. Indiana is her residence. Can you help her and me out on this?
Beth on September 27, 2009 5:50 pm
Can my boyfriend buy a house from my parents and have my name on the Mortgage and still receive the 8,000 tax credit. I need to be included in the loan to help make the loan payments and be approved for the loan, but would my name on the mortgage or deed keep us from getting the 8,000 credit back since I am related to the seller, but he is not?
keith hart on October 27, 2009 1:37 am
i live in ridgevill,sc and just closed on the 14th of october,and amended last years taxes for the 8000 crdit how long does it really take to come inand is there a irs contact number to check since with buying a 160,00 new built home and all phone,electric,water ,sewer,,cable companyies running my credit it its down almost 200 points and cant even get a loan to buy furnitue ,aplliances ect
Fred Newell on October 30, 2009 10:43 am
I am a senior and do not pay $8000.00 in taxes.
Will I get the whole $8000.00 in the year I claim it, (similar to earned income credit) or will I be able to carry it forward to a number of years to get it all, or will I lose what I can not claim in one year?
mike on November 4, 2009 8:43 am
I think this is so messed up the part where you cant get the 8000 if you buy form a relitave. my father was getting very sick with cancer and could not work any longer instead of letting his house go i bought it from him this was my first house.. went through the loan process and attorney for closing everthing i would do if i bought the house from anyone else….so here i am an american trying to do my small part in keeping the country from falling even more behind with houses on the market and people not paying for them…what do i get for stepping up as a 21 year old kid trying to save his family’s home….not the 8000 dollars mr. pres promised to everone who bought a house
So i ask does anyone else see my point
p.s my father passed away few months ago and here i am hurting like i have never know before.. and i think wow 8000 would realy help me so much for beleaving in this goverment
sent form my iphone
martha mcleod on November 18, 2009 3:51 pm
My son served his country for 20 years. Came home 60 percent disable. I want to sell my house to him. I am getting older and can no longer maintain the house. So what does he get? Not the $8000. This is insane. He will have a mortgage and will buy it for the appraised value. How sad can this country get. I have contacted representatives, loan officers and the internal revenue. No one knew this stipulation was in the bill. Again signing something they have never read. I know someone ” in charge ” surely can fix this.