March 4th, 2009 11:51 AM

$8,000 tax credit from the Stimulus Bill

By Jim Frimmer, San Diego Mission Valley Realtor (Century 21 Award):

The Stimulus Bill signed by President Obama recently provides a tax credit incentive for certain home buyers.

Here are the highlights of the $8,000 tax credit from the Stimulus Bill:

1. If the home you are buying is your first home, you are eligible for an $8,000 tax credit.
2. If the home you are buying is not your first home, but you have had no ownership interest in a home for the previous three years, you are eligible for an $8,000 tax credit.
3. The tax credit is literally that, a credit, so you will need to come up with the appropriate down payment for your home.
4. You have to buy the home between January 1, 2009, and the end of 2009. I say end of the year because I have seen conflicting information about the ending date. Some say November 30, some say December 1, and some say December 31. I'm continuing to try to find out which is correct and will update this when I do. Perhaps some commenters can help us here.
5. You have to close escrow on your home by "the end of 2009," so you probably need to make a purchase offer earlier in order to get your home inspection, repair negotiations, appraisal, and loan documents in on time to close escrow before "the end of 2009."
6. You will apply for your $8,000 tax credit on your income tax return. At that time, if you are owed money from the government, it could include that tax credit. So it's possible that if you were to owe the government nothing when you file your taxes, buying a house and using the $8,000 tax credit could result in a windfall $8,000 coming from the government.
7. $8,000, or 10% of the home's purchase price, is the maximum allowed, so if you buy a $70,000 condo, your tax credit would be $7,000.
8. You have to live in the home our buy for three years. If you don't, then you have to repay the credit.
9. You can get the tax credit on your 2008 return by filing an amended return after you close escrow on the house. Otherwise you can get it when you file your 2009 return in 2010.

*****

Type the characters you see in this picture, click "Submit" when finished.

		This helps us prevent automated programs from creating bogus contacts and adding them to your contacts database.