$8,000 Tax Credit for First-Time Homebuyers:
The original Senate proposal was for a $15,000 tax credit for all purchases of homes. The new stimulus package contains an $8,000 tax credit restricted to first-time homebuyers. Here’s a breakdown of the legislation signed:
- The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.
- The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.
- The tax credit is for first-time homebuyers only. (Cannot have owned a principal residence over the three years prior to purchase)
Unlike the previous credit, the new tax credit does not have to be repaid. (There is a recapture clause for home’s sold within three years the entire amount of the credit is recaptured on the sale)
- Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit. The credit phases out for incomes above these levels.