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First Time Home Buyer Tax Credit

* $8,000 Tax Credit at a Glance:

Q.  What is the definition of a first time home buyer?

A.    A first time home buyer is defined as a buyer who has not owned a principal residence during the three year period prior to the purchase.

Q. Is a tax credit the same as a deduction?

A. No. A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. For example, a taxpayer who owes $2,000 in income taxes and who receives an $8,000 tax credit, would receive a refund from the IRS of $6,000.

Q.  Is there a minimum purchase price to be eligible for the tax credit?

A. No. The tax credit is equal to 10% of the homes purchase price up to a maximum of $8,000.

Q. What is the deadline to purchase a home and qualify for the tax credit?

A. The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.

Q. Are there any income limits for claiming the credit?

A. Single taxpayers with income up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.

*Buyer must occupy the property for at least 3 yrs as their primary residence or they have to pay back the $8K or                                          whatever they got back.