5 Ways First-Time Home Buyers Could Miss Out on This Year’s Tax Credit

The 2009 First-Time Homebuyer’s Tax Credit passed by Congress this year just might be the best financial opportunity available to qualified home buyers in a generation. The new credit is retroactive to January 1, 2009. Unlike the 2008 package, this is not a loan. Eligible first-time buyers receive an $8,000 tax credit from Uncle Sam that does not need to be paid back.

Sweetening the pot, the law states that a first-time buyer is not necessarily a first-time buyer; the tax credit is available to any buyer who has not owned a home for the past three years. But the opportunity comes with some caveats. Here are five ways you could potentially miss out on this golden opportunity:
• Miss the buying deadline – The law states a home must be purchased between January 1 and November 30 of this year. But that means the transaction must close—not simply be in progress—before December 1.
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• Delay on new construction – Because you must actually close on a home by November 30, 2009, you need to be careful about new construction estimates. If you want to buy a newly-built home, you should buy one that is either already completed or is about to be completed. New construction buyers must occupy the home by the deadline date.
• Misunderstand your eligibility – The right to use the tax credit is gradually phased out as adjusted gross income (AGI) rises from $75,000 to $95,000 on a single return or $150,000 to $170,000 on a joint return. If unsure of your eligibility, check with your tax advisor.
• Fail to plan ahead – There is an exception to the no-pay-back rule: You do have to repay the $8,000 if you sell the house within three years of the time you buy it. The home must be your principal residence and there is a recapture provision if you move out or sell before three years.
• Miss the boat for no good reason – Inertia…fear of rocking the boat…just-too-busy syndrome. Take advantage of today’s buyer’s market and talk to a real estate professional to find out if and how the tax credit applies to your particular situation. Time is running out to take advantage of this financial incentive.
As a Member of the Top 5 in Real Estate Network®, I am committed to providing the most up-to-date information on the details surrounding the First-Time Homebuyer’s Tax Credit. Please e-mail me with any questions you may have and please forward this article to any family and friends who may qualify for this great opportunity.

Sincerely

Anthony

Anthony Crecco
Crecco Real Estate
Top 5 in Real Estate Member
Top5@CreccoRealEstate.com
www.CreccoRealEstate.com

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