The American Recovery and Investment act has been modified as of February 2009.
The new 1st time buyer stimulus package has been changed to give a home buyer a tax credit of up to $8000 for the purchase of a home.
The chart above gives a complete summary of the key points of the in the American Recovery and Investment Act.
Some of the most frequently asked questions on this new stimulus package can be found at The National Association of Home Builders website under the frequently asked questions about home buyers tax credit.
Frankly this is the best resource on the 1st time home buyer tax credit I have seen. The questions answered at the site include the following.
- Who is eligible to claim the tax credit?
- What is the definition of a first-time home buyer?
- How is the amount of the tax credit determined?
- Are there any income limits for claiming the tax credit?
- What is "modified adjusted gross income"?
- If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
- Can you give me an example of how the partial tax credit is determined?
- How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?
- How do I claim the tax credit? Do I need to complete a form or application?
- What types of homes will qualify for the tax credit?
- I read that the tax credit is "refundable." What does that mean?
- I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns. How can I claim the new $8,000 tax credit instead?
- Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
- Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
- I live in the District of Columbia. Can I claim both the Washington, D.C. first-time home buyer credit and this new credit?
- I am not a U.S. citizen. Can I claim the tax credit?
- Is a tax credit the same as a tax deduction?
- I bought a home in 2008. Do I qualify for this credit?
- Is there any way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 tax return?
- If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
- For a home purchase in 2009, can I choose whether to treat the purchase as occurring in 2008 or 2009, depending on in which year my credit amount is the largest?
If you have been thinking about buying a home in the Metrowest Massachusetts area now my be the time. Interest rates are near historic lows, home values in many locations have dropped by as much as 25% from the peak, and the tax credit is only around till the end of the year. $8000 is not chump change for most looking to buy their 1st home.
Want to work with a top Realtor? Visit my website at Metrowest Mass Real Estate or my blog at Westboro Real Estate.