If you haven’t owned a home in the last three years, you may be eligible for the federal tax credit!
The federal economic stimulus plan calls for an income tax credit worth 10% of the purchase price of the home, up to a maximum of $8,000 for a single resident or a married couple filing jointly. If you haven’t owned a home in the last three years, you can qualify for this tax credit when you purchase a home between January 1, 2009 and April 30, 2010.
The tax credit reduces your income tax bill or increases your tax refund, dollar for dollar. The credit will be paid out to you even if you don’t owe taxes or the amount of the credit is greater than the taxes you owe. Best of all, as long as you keep your home for at least three years, there is no repayment requirement.
In order to qualify for the tax credit, you must:
- Have not owned a home in the last three years
- Purchase a home between January 1, 2009 and April 30, 2010
- Earn $150,000 or less (individual filers with modified adjusted gross income of $75,000 or less, or married couples filing jointly with modified adjusted gross income of $150,000 or less are eligible)
- Purchase your principal residence (purchases of vacation homes and rental properties are not eligible)