Thursday, August 6, 2009

First Time Home Buyer Tax Credit

This post will begin a series of helpful information for the First Time Home Buyer. So if that is YOU keep reading and look for more in the future!

So you are purchasing your first home! Congratulations! Now you can take advantage of the 2009 First Time Home Buyer Tax Credit. Here's what you need to do to get your tax benefit:
  1. Close on your home purchase by November 30, 2009. If your not in escrow now, that only gives you 2 months to find something and get into escrow. Call me and I will find you the perfect home to purchase as a First Time Buyer before the November 30th deadline.
  2. Ensure that you are a qualified first-time buyer under IRS guidelines. If you are not sure if that is you give me a call.
  3. Decide which year to file under, 2008 or 2009.
  4. File an amended 2008 return or choose to apply the credit to your 2009 tax return.


If you want the benefits of your credit as soon as possible: you might choose to file under your 2008 tax year. Since April 15 has come and gone, you would have to file an amendment to your return. However if you have already filed for an extension of your 2008 return, then you can simply claim the credit when you submit your return.

If you anticipate a drop in income next year: You can wait to claim the credit as part of your 2009 filing. In some cases the value of the credit might be higher, particularly if in 2008 you qualify for only a partial credit because your income is over $75K (single) or $150K (joint).


Once you have determined which year to apply the tax credit, you will need to do two things to claim the credit:

  1. Fill out Form 5404 to determine the amount of your available credit.
  2. File an amended return for your 2008 taxes, or wait and apply to credit when you file your 2009 tax return.

Whatever you decide please let me know if I can be of any help!

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