Theme: Discover Important Information About Tax Credit
March 29, 2009In a ongoing effort to promote the economy by jumpstarting Evergreen real estate sales by first time home buyers, Congress recently enacted a huge tax credit of up to $8,000 for qualified first-time home buyers purchasing a primary home on or after Jan. 1, 2009 and before Dec. 1, 2009.
A tax credit is much superior than a tax deduction since it is a direct reduction in the amount of taxes owed. This typically results in a massive tax refund! Or if you modify your tax withholdings– you’ll net considerably more from each paycheck.
The tax credit is for first time home buyers only. Don’t rule yourself out if you have previously owned a home. The law defines a first time buyer as one who has not owned a principal residence in the previous 3 years—a rental home or vacation home won’t exclude you from this tax credit.
Many Buyers will qualify for the entire $8,000 credit since it is equal to 10%of the home’s purchase price (up to $8,000).
There are income restrictions with the credit which are important to consider. The tax credit is decreased for tax payers with Modified Adjusted Gross Incomes greater than $75,000 for an individual or $150,000 for a married couple filing jointly. The tax credit is not for those with MAGI greater than $95,000 or $170,000 for married couples.
The tax credit does not have to be paid back—as long as you use the residence as a principal residence for at least three years. All homes bought as a primary residence will qualify for the credit. This includes single-family detached homes, attached homes like townhouses and condominiums, manufactured homes (also known as mobile homes) and houseboats although, again, you would have to use the residence as your principal residence.
You can even build your own home—or have a contractor or new home builder to build the residence as long as long as the first date of occupancy of the new home is before December 1, 2009 and if a new home builder builds it—the closing occurs prior to December 1, 2009.
This program can be combined with the Mortgage Revenue Bond (MRB) for additional benefit.
If you are considering Denver homes for sale you might be able to take advantage of this credit.
Overall this tax credit is basically like a bonus for first time Buyers. The government is more or less paying $8,000 to you to buy a home! This combination of tax credit bonus, low interest rates, big amount of inventory and reduced prices on many homes makes it a great time to buy a home.
If you’re considering buying a home in Colorado take a look at Evergreen Real Estate.
P.S. Find out why people begin saving money with the help of silver bullion bars.