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The 2009 Federal
First-Time Homebuyers Tax Credit FAQ’s:
Q
What is the amount of
the new tax
credit?
A
$8,000
Q
Who is eligible for the
$8,000
tax credit?
A
First time
homebuyers who closed (or will close) on homes between January 1, 2009 and
November 30, 2009.
Q
What are the details of
the new tax
credit?
A
The new tax
credit is an $8,000
refundable tax credit (or up to10%of the purchase price). This means that
if your total tax liability in the given year is less than
$8,000
the IRS will send a refund for the balance.
Q
Do I have to pay back
the credit?
A
If you occupy
your home for three years you will not have to pay back the credit.
Q
Who qualifies for the
credit?
A
The home must be a home
located in the United States and is generally considered to be the home where
you spend 50% or more of your time. It can be a condo, single family detached,
co-op, townhouse or something similar. Vacation homes and rental properties are
not eligible. For new construction, the “purchase date” is the date you occupy
the home.
Q
What if I purchased a
home between April 8, 2008 and January 1, 2009?
A
Purchasers who
bought between 4/8/08 and 1/1/2009 are subject to the terms of the
$7,500
repayable credit.
Q
Who do I contact if I
have more questions about this credit?
A
Contact a 1st
Mortgage of Illinois, Inc. Loan Officer, your REALTOR®,
or your tax preparer, or call the IRS
toll-free at (800) 829-1040 for more information on the tax credit. This
information is accurate based on the information available as of February 19,
2009. As with any tax law change, check with a tax advisor if there are any
question regarding using this provision.
Q
Who cannot take the
credit?
A
Purchasers with
any of the below circumstances cannot take the credit:
• Your income exceeds the phase-out range. This means joint
filers with Modified Adjusted Gross Income (MAGI) of
$170,000
and above and other tax payers with MAGI of
$95,000
and above.
• You buy your house from a close relative. This includes your
spouse, parent, grandparent, child or grandchild.
• You stop using your home as your main home.
• You sell you home before the end of three years.
• You are a nonresident alien.
Q
What are the income
limits?
A
The credit is
reduced or eliminated for higher income taxpayers. Joint filers with a MAGI of
$170,000
and above and single filers with a MAGI of
$95,000
and above are ineligible for the credit. Singles making between
$75,000
and $95,000
and joint filers with a MAGI of between
$150,000
and $170,000
are in the “phase-out” range, meaning you will only receive a fraction for the
$8,000 tax credit.
Q
When/How can I claim
the credit?
A
It can be claimed
on your 2008 tax return (to be filed by April 15, 2009), an amended 2008 Tax
Return, or your 2009 Tax Return.
Q
Who cannot take the
credit?
A
Purchasers with
any of the below circumstances cannot take the credit:
• Your income exceeds the phase-out range. This means joint
filers with Modified Adjusted Gross Income (MAGI) of
$170,000
and above and other taxpayers with MAGI of
$95,000
and above.
• You buy your house from a close relative. This includes your
spouse, parent, grandparent, child or grandchild.
• You stop using your home as your main home.
• You sell you home before the end of three years.
• You are a nonresident alien.
Q
What are the income
limits?
A
The credit is
reduced or eliminated for higher income taxpayers. Joint filers with a MAGI of
$170,000
and above and single filers with a MAGI of
$95,000
and above are ineligible for the credit. Singles making between
$75,000
and $95,000
and joint filers with a MAGI of between
$150,000
and $170,000
are in the “phase-out” range, meaning you will only receive a fraction for the
$8,000 tax credit.
Q
When/How can I claim
the credit?
A
It can be claimed
on your 2008 tax return (to be filed by April 15, 2009), an amended 2008 Tax
Return, or your 2009 Tax Return.
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more than a pre-qualification letter. It is a "written commitment to
make a mortgage loan" short of the appraisal, the language contained in the
mortgage constringency clause of any residential sales contract.
Remember, just ask in advance to review a Good Faith Estimate,
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