This information is accurate as of April 2009.
There are actually 2 credits that exist. One for purchases after April 9, 2008 for a maximum of $7500 and the new credit with a maximum of $8000. The new credit ($8000) is the topic of this discussion. Here are some of the important points:
· The amount of the credit is a maximum of $8000 (10% of sales price).
· The purchase for the $8,000 credit must be on or after January 1, 2009 and before December 1, 2009.
· The property must qualify: Any single family residence, including co-ops, condos, townhouses, that will be used as a principal residence.
· There is an income limit for the purchaser: Full amount of credit is available for individuals with an AGI of less than $75,000 or for joint returns less than $150,000.
· The credit is for first time homebuyers only. The purchaser and the purchaser’s spouse may not have owned a principal residence in 3 years previous to purchase.
· Purchasers who are using bond money can use the credit.
· There is no repayment of the credit (the previous one required repayment).
· There is a “bad news” component to this: If the home is sold within three years of purchase, the entire amount of the credit is recaptured upon sale.
· The termination date is December 1, 2009.
Here is a link to the IRS website that will give you more information about the 2008 credit ($7,500): http://www.irs.gov/newsroom/article/0,,id=187935,00.html
Information about the 2009 credit is here: http://www.irs.gov/newsroom/article/0,,id=204671,00.html
In order to claim the credit, you will need to file a form with the IRS: http://www.irs.gov/pub/irs-pdf/f5405.pdf
If you have questions about filing with the IRS, please contact your tax consultant or accountant