New Home Buyers Tax Credit
WHY NOW IS THE TIME TO BUY
There has never been a better time for buyers to purchase real estate. Prices are way below appraised value, rates are as low as they were in the 40's, and the inventory is plentiful. Of course, this does not apply to the National Market, but to local real estate markets that are in good shape vs. those in dire straits. But, if you have good credit, the following is a quote from Suzy Ormond, "take your money out of the stock market, which has NOT hit bottom, and won't for 3 - 4 years, and put it into real estate." Donald Trump has also given this same information on CNN, Fox News and CNBC several times.
WHAT IS THE FIRST TIME HOME BUYER TAX CREDIT?
1. First-Time Buyers will be GIVEN an Eight Thousand Dollar ($8,000) credit to purchase a home, which is an enticement to revitalize the 'troubled' real estate market. This credit is equivalent to 10 percent of the purchase price of the home --- although it's capped at $8,000 --- and applies only to First-Time Home Buyers purchasing their principal residence. But unlike an earlier $7,500 home buyer tax credit, this one does not have to be repaid but is a gift from the Government.
2. First Time Buyers defined: For the purpose of this legislation, a "First-Time Home Buyer" is someone who has not owned a principal residence for three years in the State of Maryland. (The date of purchase is considered the day that the title is transferred.) That means if you have owned a vacation home, but not a "principal residence" within the past three years, you would still qualify for the credit.
3. This is for buyers in 2009 only: Only those who purchase a home after January 1, 2009 and before December 1, 2009 are eligible for this credit. Unfortunately, anyone who bought a home last year is not able to take advantage of it.
4. Income limits: The tax credit is subject to income limitations. Single buyers need a modified adjusted gross income of $75,000 or less to qualify for the full credit; the amount of income for married couples is $150,000. However, those earning more than the qualified amounts may be eligible for reduced credits.
5. Recapture: Buyers have to own the home for at least three years in order to capitalize on the credit. If they sell the home before then, they will have to return the credit to the Government. (Exceptions will be made in certain cases, such as death or divorce).