First Time Home Buyer Tax Credit

Now we have triple big incentives for home buyers. Low Prices, Low Interest Rates, and now an up to $8,000 tax credit.

Are you eligible? Check out the video below to find out.

Since we created this video, the original tax credit expired, but, great news, it's been extended.

First time home buyers and Homeowners who have lived in a current home five of the last eight years are eligible for $8,000 and $6,500 respectively in income tax credits. To take advantage of the credit, you must have a binding contract by April 30, 2010 and must close by June 30, 2010.

The $8,000 credit is available for first time home buyers ($4,000 for married couples filing separately) and $6,500 ($3,250 for married couples filing separately) for existing home owners. First time home buyer means that you have not had an interest in a principal residence for three years prior to the purchase.

Income limits have been increased to $125,000 for singles and $225,000 for married couples. There is an additional phase for the next $20,000 in income with a reduced credit.

Homes up to $800,000 are eligible for the credit and yes this is a credit, not a deduction to you income. You will receive money back from the government if you owe less taxes than the value of the credit. So, if you owe $2,000 in income tax and you take the full $8,000 credit, you will get a check back for the difference – $6,000.

We've created a video to explain the First Time Home Buyers Tax Credit. Adding this tax credit to already low prices and historically low interest rates makes for an incredible incentive to purchase Daytona Beach homes and condos now.

The Daytona Beach real estate market has been stronger early in 2009 and many people are taking advantage of the buyers market. January sales were up 29% over last year in January.

Please watch the video to get the full story on the new tax credit that is part of American Recovery and Reinvestment Act of 2009. Call me or email me for more information.

What is the Tax Credit?

A Tax Credit Against Federal Income Tax fof up to $8,000 and does not need to be repaid
10% of Purchase Price up to $8,000
Is Refundable (a payout) if you don’t owe the full $8,000 in taxes
Can be used for New or Existing Homes, Condos, Manufactured Homes and House Boats

Who is Eligible for the Tax Credit?

First Time Home Buyers
Single People you have not owned their principle residence in the last three years
Married couples where neither has owned their principle residence in the past three years
Current Home Owners who have lived in their homes five of the last eight years

Who Get the Full Credit?

Eligible singles with MAGI of less than $125,000
Married couples with MAGI of less than $225,000
The credit is reduced proportionately over the MAGI
Check with a tax professional

What is MAGI?

MAGI - Modified Adjusted Gross Income
Adjusted Gross Income (AGI) with items such as foreign income, foreign-housing deductions, student-loan deductions, IRA-contribution deductions and deductions for higher-education costs added back in

What Period of Time is Eligible?

Now until finalized contracts before April 30, 2010 and closed by June 30.
Can be taken on 2008 Income Tax Return

How Do I Take the Credit?

Complete IRS Form 5405
On your Federal Income Tax Return under credits
Can lower withholding if you are certain you are eligible for the credit.

Remember, Daytona Beach Condos and homes are covered under the tax credit. The Daytona Beach area includes Port Orange, Ormond Beach, Ponce Inlet, Palm Coast, New Smyrna Beach and Ormond by the Sea.