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http://www.mydollarplan.com/my...dit-is-not-a-credit/

What Is It?

It’s a 15 year 0% interest free loan from the government. It’s only called a tax credit because the IRS is handling the distribution of the money. The money will be given to you via a tax credit. You will then repay the loan over the next 15 years through increased taxes.
How Much Is It?

* You can receive 10% of the purchase price of your home, capped at $7,500.
* Income phaseouts to qualify for the entire amount are $75,000 for single filers and $150,000 for married filing joint. Partial credits are available up to $95,000 for single and $170,000 for married.
* It’s refundable, so if your tax liability is less than the credit, you can get the money back.

Who Can Use It?

First time home buyers (a buyer who has not owned a principal residence during the prior 3 year period). For married couples, both of you must be first-time home buyers. The home can also include townhouses, condos, mobile home and houseboats.
How Does It Work?

Purchase your home between April 9, 2008 and before July 1, 2009. (If you build your house, the occupancy date must fall between those dates.) Claim the credit when you file your tax return.

You can claim your First Time Home Buyer Credit on Form 5405. I did a trial entry using TaxCut and it was simple. You just enter your address, date acquired, and purchase price. TaxCut calculates how much of the credit you are eligible for and shows you the payback schedule.
Payback Terms

The credit must be paid back evenly over 15 years ($500 per year for the full amount), beginning 2 years later. If you sell your home before the 15 years are up, you will owe the rest in the year of the sale from the capital gains on the home sale. If there are no gains on the sale, you will not have to repay the rest of the loan.
I'm not sure about the accuracy of that source, Ronnie P.

"This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately."

(Quote from the IRS):
http://www.irs.gov/newsroom/ar...0,,id=204672,00.html
Yes, I know someone. They paid $94,000 for their house in January and filed their taxes in March and got $8000 tax credit back. The credit does not have to be paid back as long as the house is their main residence for 36 months.

the information Ronnie quoted was the old program that was in place before Obama brought in this one with the Stimulus Plan.
quote:
Originally posted by Appalachian American:
I don't know about this one. I got one through Suntrust 1n 1994. It loaned 95% of the price with a Fixed interest of 8.5%. I never took out a second on it or refinanced, and had a fifteen year mortgage. It paid off in June!
.......Congratulations AA !!!!!! Feels good eh?
quote:
Originally posted by tomfan:
I'm not sure about the accuracy of that source, Ronnie P.

"This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can claim the credit on either their 2008 or 2009 tax returns. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000, or $4,000 for married individuals filing separately."

(Quote from the IRS):
http://www.irs.gov/newsroom/ar...0,,id=204672,00.html


You are correct Tomfan. That is the catch -- you can't buy it use the credit and then flip it in other words. You must keep it 36 months and a day...then you can sell it...You know the government and it's loop holes...
My husband and I purchased a home in July of 08 using the 1st time home buyers loan through Compass. It does have its catches but at the time I was unemployed so we only had one bringing in income. We got $7,500 because but we put down $15,000 on our house. You don't have to pay the money back if you stay at the residence for 5 years. Also when we filed our taxes this past year we got the option to also get an extra $8,000 back on our taxes that's a tax free loan. We did it becauseat the time my husband had just been laid off and thought if something happened we might just need that cash. And the way that works is at the end of the year they take out $500 on ur tax refund to pay back the loan. We have put that money in savings and not touched it thank goodness he and I both are working. If you move before you have paid it all back ($8.000) you have to pay the remaining balance at the end of that year
Thanks for all the replies. We are considering selling ours and from my understanding, somebody looking for a house that was priced in the 80's were going to get the most bang for their buck, so to speak with the tax credit. It was my understanding that if you bought a 60k house you could only get 6k in credit but if you bought a 100k house you only get the 8k credit.

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