The expiration date of the $8,000 first-time home buyer may have already passed for most, but there are some potential homebuyers who can still take advantage of this great opportunity.
For those who are qualified service members, you have an extra year to cash in on the credit. Your new deadline is April 30, 2011. The government defines "qualified service member" as a member of the uniformed services of the U.S military, a member of the Foreign Service of the U.S., or an employee of the intelligence community."
The reasoning behind this extension is simple. National Association of Home Builders Chairman, Bob Jones, says, "Congress recognized that many service members may have missed out on the home buyer tax credit due to being posted overseas. It is only fitting that they be given another year to take advantage of this opportunity in appreciation of the sacrifices they have made serving our country."
There has been another modification to the credit for members of the armed service. Currently, a buyer must repay the credit if they move out of their new home within three years. This particular contingency has been waived if the move is due to government ordered extended duty service.
Buyers must meet the other qualification for the credit, however, including the income limits. These limits are set at $125,000 for single taxpayers and $225,000 for married taxpayers filing joint returns.
You must be a first-time home buyer, which is defined as "a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse."
If you don't fit under this definition, then be sure to check into the $6,500 repeat buyer tax credit.
To get the first-time home buyers credit, you will need to claim it on your federal income tax return. There is a specific form (IRS Form 5405) that helps you determine how much the credit will be. Be sure to talk to your tax professional about the credit to ensure it is submitted correctly.
For those interested in the credit, you can visit FederalHousingTaxCredit.com to find out more information.
Article written Carla Davis, Realty Times, May 4, 2010
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