Panama City Real Estate | First Time Home buyer credit

Posted on March 9, 2010
Filed Under First time Florida home buyers | 2 Comments

If you’re a home buyer hoping to take advantage of the First Time Home buyer credit here are some helpful facts on how to take full advantage of the credit:

According the IRS.gov website:

  1. You must enter into a binding contract to purchase a principle residence by April 30, 2010
  2. You must close on the property by June 30, 2010, . Buyers may elect to use the credit on their 2009 or 2010 tax returns.

As you can see, time is of the essence and if you want to take advantage of the credit, now is the time to act.

The IRS.gov website has some great information to brush-up on filing requirements and to help with submitting the required application.

Below are several useful links:

Also, if you purchased a home as your principal residence in 2008, 2009 and early 2010 you may also be able to take advantage of the tax credit.

Here are some facts for home buyers in this category:

  1. The tax credit is 10 percent of the purchase price of the home with a maximum credit of $8,000
  2. The tax credit will either reduce your tax bill (dollar for dollar) or increase your refund
  3. The credit does not have to be paid back unless the home ceases to be your principal residence within three years after the purchase.

A little something for long-term residents

In addition to the First Time Home buyer Credit, long-term residents residing in the same house for any five consecutive-year period may qualify for a $6,500 credit when purchasing a new principal residence in the United States.

Here are the facts for this category:

  1. The purchase must have taken place after November 6, 2009, and before May 1, 2010 or after April 30, 2010, and before July 1, 2010
  2. The buyer must have entered into a binding contract before May 1, 2010 to purchase the property before July 1, 2010
  3. Buyers must have lived in the same home for any five consecutive-year period during the 8-year period ending on the date you purchased your new primary home.

Rules for those who cannot claim the Tax credits…

According to the IRS.gov website:

  1. A buyer cannot claim the credit if the purchase price of the home is more than $800,000.  This rule applies to homes purchased after November 6, 2009.
  2. You may not claim the credit if your modified adjusted gross income is $95,000 or more ($170,000 or more if married filing jointly) and you purchased your home before November 7, 2009
  3. Or $145,000 or more ($245,000 or more if married filing jointly) and you purchased your home after November 6, 2009.

How to Apply for the Credit:

Buyers wanting to take advantage of the credit must fill out IRS Form 5045 and file the form with your federal income tax return.

If you have already filed your return, you may claim the credit by filing out an IRS 1040X with the completed Form 5045 attached.  Any and all supporting documentation regarding the purchase is required and should be included.

The information provided above on the First-Time Home buyer tax credit was from the IRS.gov website and is deemed reliable, but not guaranteed.

When dealing with tax related issues, it is imperative that you follow all IRS Guidelines and obtain the advice and guidance of a qualified tax professional.

Jennifer Mackay
850-774-6582
Florida Real Estate | Panama City

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Author : Jennifer Mackay - Posts:280

Jennifer Mackay is an award winning real estate agent and Keller Williams team leader in the Panama City Florida area. Her website: Panama City Real Estate provides guidance, information and free buying and purchasing features for registered visitors. Follow: @realtorjennifer | Facebook

Comments

2 Responses to “Panama City Real Estate | First Time Home buyer credit”

  1. Tampa Homes for Sale on March 30th, 2010 1:59 pm

    Although the incentives and breaks are a lifesaver in the short term, I and some of my colleagues believe that too many people are making decisions based on deadlines, rather then truly weighing the pros and cons of buying a home. What are your thoughts Jennifer?

  2. Jennifer Mackay on March 30th, 2010 7:45 pm

    Thanks for stopping by…

    To answer your question: I believe there are not enough incentives currently available. While the first time home buyer and move up buyer incentives are helpful, I would have liked to see additional incentives for those who already own a home and are having difficulties.

    Our market is seeing very low prices and those who perform their diligence as to whether they can truly afford to purchase now, will benefit greatly in the next few years.

    IMO, those that opt to wait to attain additional financial stability before purchasing a home will not lose out on the good deals.

    There will always be good deals in the market, you may have to look harder… But they can be found.

    Best wishes.

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