$8,000 Tax Credit For First-Time Homebuyers

Thinking about buying your first home - or haven't owned a home in three years? Right now, you may have 8,000 reasons to help make your dream a reality. The American Recovery and Reinvestment Act of 2009 provides for a First-Time Homebuyers Tax Credit of $8,000 maximum per qualified buyer. A person is considered a first-time buyer if he/she has not had any ownership interest in a home in the three years previous to the day of the 2009 purchase.

Here's what you need to know:

* The temporary credit is only available for homes purchased between Jan. 1, 2009 - Nov. 30, 2009.
* The credit is equal to 10 percent of the cost of the home, up to a maximum $8,000 credit.
* If you qualify for the credit, you can apply for downpayment assistance through the State of Florida or the Federal Housing Administration before you close on the purchase of your home, then repay the borrowed amount when you get your tax credit.
* You have only until Nov. 30, 2009 to find your home, secure financing, and close to receive the $8,000 tax credit/downpayment assistance.
* If you claim the tax credit on your federal tax return and the credit is more than the taxes you owe, you get a refund check for the difference.
* For purposes of the tax credit, a first-time buyer means an individual who has not owned a home in the past three years (includes anything to be used as a principal single-family residence, including condos and townhouses).
* There are income guidelines: Individuals with an adjusted gross income up to $75,000 (or $150,000 if filing jointly) are eligible for the full credit. The credit is phased down if you earn more and isn't available if you make more than $95,000 (or $170,000 if filing jointly).
* The tax credit doesn't have to be repaid if you live in your home for at least three years.

For specific tax or legal advice, consult your attorney or a qualified tax professional.