$8000 Tax Credit for Buying Arizona Real Estate
What would you do with $8000...that you don't need to pay back!! Of course I'm talking about the First-Time Homebuyer Tax Credit.
The credit was expanded as part of the most recent economic stimulus bill (The American Recovery and Reinvestment Act). The credit was designed to encourage first time buyers to go ahead and take that step towards owning their first home. Combine this tax credit with the fact that home prices and interest rates are at historic lows, and you will see why NOW is the ideal time for many first-time homebuyers to purchase a home.What are some of the details about the tax credit that I should be aware of? A first-time home buyer is defined as someone who has not owned a home in the last three years. If married, both spouses must be first-time home buyers. If more than one unmarried individual is buying the property, the credit can be split up among all the individuals who qualify. However, the total credit taken cannot exceed $7500 for homes purchased in 2008 and $8000 for homes purchased in 2009.
Single taxpayers with incomes up to $75,000, and married couples with incomes up to $150,000 qualify for the full tax credit. You cannot purchase the home from a related party like a spouse, direct ancestor, or direct family descendant. However, you can still qualify for the credit if you purhcase a property from siblings, nephews, nieces and others.
When Does the $8000 Home Buyers Tax Credit Go In To Effect
The current tax credit is for homes purchased between January 1, 2009 and December 31, 2009. The credit amounts to 10% of the purchase price of the home, not to exceed $8,000. Also, the tax credit does not need to be paid back if you continue living in the home as your primary residence for three years without selling it.
How Does a Tax Credit Work?
A tax credit is a special provision that reduces income tax liablity on a dollar for dollar basis. When filing a tax return, you must include all your income, deductions, and the number of exemptions, among other things, to figure out your complete tax liability. There are specific forms that will need to be filled out when you do file your taxes, so be sure to contact your tax professional for these forms.
For more informtion about how you can take advantage of the $8000 first-time home buyer tax credit, just give me a call at 480-497-1649. I would be happy to assist you in the purchase of your new home.
