1.4 Million Families Have Taken Advantage of First-Time Home Buyer Tax Credit, More Claims Expected

RISMEDIA, October 8, 2009—With the First-Time Home Buyer Tax Credit deadline quickly approaching, the Internal Revenue Service recently reminded potential home buyers they must complete their first-time home purchases before Dec. 1, 2009 to qualify for the special first-time home buyer credit. The American Recovery and Reinvestment Act extended the tax credit, which has provided a tax benefit to more than 1.4 million taxpayers so far.
The credit of up to $8,000 is generally available to home buyers with qualifying income levels who have never owned a home or have not owned one in the past three years.

The IRS encouraged all eligible homebuyers to take advantage of the first-time home buyer credit but at the same time cautioned taxpayers to avoid schemes that help ineligible people file false claims for the credit. Currently, the agency is investigating a number of cases of potential fraud and is using computer screening tools to identify questionable claims for the credit.
Because the credit is only in effect for a limited time, those considering buying a home must act soon to qualify for the credit. Under the Recovery Act, an eligible home purchase must be completed before Dec. 1, 2009. This means that the last day to close on a home is Nov. 30.

The credit cannot be claimed until after the purchase is completed. For purchases made this year before Dec. 1, taxpayers have the option of claiming the credit on their 2008 returns or waiting until next year and claiming it on their 2009 returns.
For those considering a home purchase this fall, here are some other details about the first-time home buyer credit:

-The credit is 10% of the purchase price of the home, with a maximum available credit of $8,000 for either a single taxpayer or a married couple filing jointly. The limit is $4,000 for a married person filing a separate return. In most cases, the full credit will be available for homes costing $80,000 or more.

-The credit reduces the taxpayer’s tax bill or increases his or her refund, dollar for dollar. Unlike most tax credits, the first-time home buyer credit is fully refundable. This means that the credit will be paid to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed.

-Only the purchase of a main home located in the United States qualifies. Vacation homes and rental properties are not eligible.

-A home constructed by the taxpayer only qualifies for the credit if the taxpayer occupies it before Dec. 1, 2009.

-The credit is reduced or eliminated for higher-income taxpayers. The credit is phased out based on the taxpayer’s modified adjusted gross income (MAGI). MAGI is adjusted gross income plus various amounts excluded from income—for example, certain foreign income. For a married couple filing a joint return, the phase-out range is $150,000 to $170,000. For other taxpayers, the range is $75,000 to $95,000. This means the full credit is available for married couples filing a joint return whose MAGI is $150,000 or less and for other taxpayers whose MAGI is $75,000 or less.

-The credit must be repaid if, within three years of purchase, the home ceases to be the taxpayer’s main home. For example, a taxpayer who claims the credit based on a qualifying purchase on Sept. 1, 2009, must repay the full credit if he or she sells the home or converts it to business or rental use at any time before Sept. 1, 2012.

Taxpayers cannot take advantage of the credit even if they buy a main home before Dec. 1 if:

-The taxpayer’s income is too large. This means joint filers with MAGI of $170,000 and above and other taxpayers with MAGI of $95,000 and above.

-The taxpayer buys a home from a close relative. This includes a home purchased from the taxpayer’s spouse, parent, grandparent, child or grandchild.

-The taxpayer owned another main home at any time during the three years prior to the date of purchase. For a married couple filing a joint return, this requirement applies to both spouses. For example, if the taxpayer bought a home on Sept. 1, 2009, the taxpayer cannot take the credit for that home if he or she owned, or had an ownership interest in, another main home at any time from Sept. 2, 2006, through Sept. 1, 2009.

-The taxpayer is a nonresident alien.

For more information, visit www.irs.gov.

Twin Cities Weekly Market Activity Report - September 28th

Here is the lastest activity report for the Twin Cities Real Estate Market for W/E September 28th, 2009.

Weekly Market Activity Report

If you have any questions or concerns let me know and I'd be happy to discuss them with you!

Chad Elliot, REALTOR
Hennepin Group, LLC
Keller Williams Integrity Northwest

Football Season is upon us!

I hope the football fans out there are enjoying the games now that College and NFL seasons are fully underway. Just remember if you are thinking about taking advantage of the 1st-time Homeowner Tax Credit you much close on your home by Nov. 30th. Contact me if you have any questions!

Enjoy the games!!!



Go Gators! and Dolphins!

Twin Cities Market Activity Report - September 8th

The latest Twin Cities Market Activity Report is out for September 8th.


If you have any questions let me know! I will be more then happy to discuss your situation and give you a free CMA on your home.

Have a Great Labor Day Weekend!

I just wanted to take a moment to wish everyone a Happy and Safe Labor Day weekend! Be safe out there and if you choose to have a few adult beverages be sure to have a sober driver. The police are out there and they are not playing any games this weekend. (Hint: Stay off Highway 10).

Chad

Twin Cities Market Activity Report - August 31st

Twin Cities Activity Report - Aug. 31st

First Time Home Buyers your time is running out. You must be close by Nov. 30th to take advantage of the $8,000 Tax Credit. Contact Chad at chadelliot@kw.com or call (651) 795-1147 for more information!