The $8000 Tax Credit For 2009
AND….What If You Bought Your First Home In 2008 ??
Overview
First-time homebuyers may be able to take advantage of a tax credit for homes purchased in 2008 or 2009. The credit:
· Applies to purchases that close after April 8, 2008, and before Dec. 1, 2009.
· Applies only to homes used as a taxpayer's principal residence.
· Reduces a taxpayer's tax bill or increases his or her refund, DOLLAR FOR DOLLAR!!!
· Is fully refundable, meaning the credit will be paid out to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed.
For 2008 Home Purchases
The Housing and Economic Recovery Act of 2008 established a tax credit for first-time homebuyers that can be worth up to $7,500. For homes purchased in 2008, the credit is similar to a no-interest loan and must be repaid in 15 equal, annual installments beginning with the 2010 income tax year.
For 2009 Home Purchases
The American Recovery and Reinvestment Act of 2009 expanded the first-time homebuyer credit by increasing the credit amount to $8,000 for purchases made in 2009 before Dec. 1 2009.
For home purchased in 2009, the credit does not have to be paid back unless the home ceases to be the taxpayer's main residence within a three-year period following the purchase.
First-time homebuyers who purchase a home in 2009 can claim the credit on either a 2008 tax return, due April 15, 2009, or a 2009 tax return, due April 15, 2010. The credit may not be claimed before the closing date. But, if the closing occurs after April 15, 2009, a taxpayer can still claim it on a 2008 tax return by requesting an extension of time to file or by filing an amended return.
Missouri Residents Rejoice!!
You Get a Tax Credit Advance To Buy Your First Home!!
Missouri Housing Development Commission (MHDC)’s New Program:
First-time homebuyers are getting the $8000 tax credit, but what if they don’t have a down payment to BUY a home?
Missouri has an answer….it is one of the first states in the nation to offer their citizens a way to get the money up front.
Here’s how it works:
MHDC makes a second mortgage to the homebuyer at the time of closing worth up to 6% of the home purchase price, or a maximum of $6750. This is used to cover down payment and closing costs for the buyer. The tax credit advance loan is paired with MHDC financing for the first mortgage in the form of a “safe” (mhdc’s words…) 30 year, fixed rate mortgage. This mortgage and the regular, first mortgage are both applied for at the same time with the lender.
The homebuyer then files for the federal tax credit and uses the credit refund to pay off the MHDC tax credit advance loan. If the tax credit advance loan is paid off by the designated deadline, June 2010 at the latest, the homeowner pays no interest other than a modest servicing fee.
If the tax credit advance loan is not paid in full by the deadline, principal and interest payments to repay the loan over 10 years begin automatically.
Qualifying for the MHDC Money:
· Household income cannot exceed $79,800.
· The tax credit will expire December 1, 2009
· You must use an approved lender, so call or email me for names
