* The tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.
* The tax credit does not have to be repaid.
* The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
* The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.
* Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.
The big difference between a tax credit and a tax deduction is that you can take the full $8,000 off of your tax bill. With a tax deduction you would reduce your adjusted gross income by the $8,000 and you would receive the benefit based on your personal tax bracket. With the credit, say you owe $2,000 in taxes (I wish). You would still receive $6,000.00 as a refund check after apply the first $2,000 towards your tax bill. All in all this is a great thing for first time homeowners; you have to purchase a home (as in actually close escrow) by November 30, 2009.
Get on it!
