| It is the dream of every individual to own their own | | | | with your spouse then you must not make more |
| home. And with the deadline for the first time home | | | | than $150,000 per annum for the same period. These |
| buyer tax credit coming up at the end of next | | | | limits have, however, been increased for sales |
| month, there has never been a better time to buy. | | | | occurring on or after November 6th, 2009. This is |
| In case you are not familiar with the program, the | | | | due to certain legislative changes a few months ago |
| gist of it is that you can get a tax credit or grant of | | | | which also extended the tax credit deadline to April |
| up to $8,000 from the federal government if you | | | | 30th, 2010. The new income limit for single tax filers |
| enter into a binding agreement by April 30th. This is | | | | who purchase homes following this date is $125,000 |
| money you do not have to repay unless the home | | | | per year and $225,000 per year for joint filers. |
| you buy stops being your primary residence within | | | | The key provisions for qualifying for the first time |
| the first three years following your purchase. (There | | | | home buyer credit seem easy enough to understand |
| are some exceptions to this, however). On top of | | | | but there are caveats that you need to be aware of. |
| that, the government will even pay a portion of your | | | | There are, for example, certain factors that could |
| down payment. And as you well know, mortgage | | | | prevent or allow you to qualify for the credit even if |
| rates have been slashed by a couple of percentage | | | | you ordinarily would (or would not) qualify. Did you |
| points. | | | | know that if you bought your home from a close |
| The first question you must be asking yourself is | | | | family member you could become ineligible for the |
| how one qualifies for this lucrative benefit. Well, the | | | | credit? Other disqualifying factors include having |
| first requirement is that you must meet the definition | | | | claimed the Washington D.C. first time home buyer |
| of a "first time home buyer" as per the current | | | | credit or if the cost of your house exceeds |
| legislation. The really interesting thing to note here is | | | | $800,000. On the other hand active duty military |
| that this definition is met so long as you and your | | | | servicemen and women and certain government |
| spouse (if applicable) have not purchased a home as | | | | officials may avail certain advantages offered to |
| your primary residence in the three years preceding | | | | them. For example, those who are under |
| your current purchase. This does not even have to | | | | government transfer orders of extended duty |
| be the first home you have ever purchased. | | | | service at a location at least 50 miles away and for a |
| Regrettably, if either of you have then neither of | | | | period of at least three months, do not have to |
| you may claim the credit. Another key phrase to | | | | repay the tax credit even if they sell or move out of |
| note here is "primary residence". This suggests that | | | | their homes within the first three years. They also |
| you are still eligible for the credit if, for instance, you | | | | have an additional year to commit to buying a home. |
| bought a vacation home or summer rental. The type | | | | Confused yet? We don't blame you. There is a lot to |
| of home purchased (e.g. townhouse, condo, | | | | sink your teeth into so make sure you understand |
| houseboat, etc) is also irrelevant. The other side of | | | | the provisions that impact you. |
| this is that you are not allowed to claim the credit for | | | | If you still have not purchased your home, time is |
| a property that is not your primary residence. | | | | running out for you to take advantage of the first |
| The second key provision in the enacted legislation is | | | | time home buyer tax credit. Now would be the time |
| that you must not exceed certain income thresholds. | | | | to start shopping around for houses and mortgage |
| These thresholds vary based on the date you | | | | rates. There is nothing more frustrating than finding |
| purchased your home. If you purchased a home | | | | out you are ineligible when you thought you were. |
| between January 1st, 2009 and November 6th, 2009 | | | | Contact some mortgage brokers and compare rates. |
| then your annual income limit is $75,000 if you are | | | | Make sure you ask relevant questions if something is |
| filing as a single tax payer. If, however, you are filing | | | | not clear. Happy Hunting! |