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Expanded Tax Break Available for 2009 First-Time Homebuyers
IR-2009-014 February 25, 2009
WASHINGTON — The Internal Revenue Service announced on February 25, 2009,
that taxpayers who qualify for the first-time homebuyer credit and
purchase a home this year before Dec. 1 have a special option available
for claiming the tax credit either on their 2008 tax returns due April 15
or on their 2009 tax returns next year.
Qualifying taxpayers who buy a home this year before Dec. 1, 2009, can get
up to $8,000, or $4,000 for married filing separately.
“For first-time homebuyers this year, this special feature can put money
in their pockets right now rather than waiting another year to claim the
tax credit," said IRS Commissioner Doug Shulman. “This important change
gives qualifying homebuyers cash they do not have to pay back.”
The IRS has posted a revised version of Form 5405, First-Time Homebuyer
Credit, on
IRS.gov.
The revised form incorporates provisions from the American Recovery and
Reinvestment Act of 2009. The instructions to the revised Form 5405
provide additional information on who can and cannot claim the credit,
income limitations and repayment of the credit.
This year, qualifying taxpayers who buy a home before Dec. 1, 2009, can
claim the credit on either their 2008 or 2009 tax returns. They do not
have to repay the credit, provided the home remains their main home for 36
months after the purchase date. They can claim 10 percent of the purchase
price up to $8,000, or $4,000 for married individuals filing separately.
The amount of the credit begins to phase out for taxpayers whose adjusted
gross income is more than $75,000, or $150,000 for joint filers.
For purposes of the credit, you are considered to be a first-time
homebuyer if you, and your spouse if you are married, did not own any
other main home during the three-year period ending on the date of
purchase.
The IRS also alerted taxpayers that the new law does not affect people who
purchased a home after April 8, 2008, and on or before Dec. 31, 2008. For
these taxpayers who are claiming the credit on their 2008 tax returns, the
maximum credit remains 10 percent of the purchase price, up to $7,500, or
$3,750 for married individuals filing separately. In addition, the credit
for these 2008 purchases must be repaid in 15 equal installments over 15
years, beginning with the 2010 tax year.
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