The Simple Version of the $8000 First Time Home Buyer Tax Credit

February 16th, 2009 categories: Buying A Duplex, Legal Stuff

Dean Schifflerof Burnet Home Loans sent out a handy chart to the agents in our company today. It really helped clear up the mud around the first time home buyer tax credit offered in the economic stimulus package.

Here, in essence, is the tax credit defined:

• Amount of credit: Lesser of 10 percent of cost of property or $8000.
• Eligible Property: All principal residences.
• Income Limit: Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Credit phases out above those caps.
• First-time Home Buyer Only: Defined as someone who has not owned a principal residence in the last three years.
• Repayment: No repayment for purchases on or after January 1, 2009 and before December 1, 2009.
• Recapture: If the home is sold within three years of purchase, the entire amount of credit is recaptured on the sale. This applies only to homes purchased in 2009.
• Termination: December 1, 20009. In other words, you have to have closed on the property by this date.
• Effective Date: All revisions are effective as of January 1, 2009.

I hope that helps.

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1. Steve said at March 22nd, 2009 at 4:01 am

   Is this to say that a duplex (where one unit is rented) is considered the same as a single family home for tax purposes? (a prinicpal residence)

2. Kari Lundin said at March 22nd, 2009 at 7:56 am

   Hi Steve -

   Whether you’re referring to the first time home buyer tax credit, or the way to track expenses on your duplex, the answer is yes. For a more detailed answer on the former, you may find this post helpful.

   http://duplexchick.com/2009/02/18/does-a-minneapolis-duplex-qualify-as-a-first-time-home/

   Kari

3. Rob said at March 31st, 2009 at 1:01 pm

   I currently own a duplex and I live in one side. I will soon be purchasing my first REAL home. Could I still qualify for at least part of the stimulus towards my single residence home?

4. Kari Lundin said at March 31st, 2009 at 2:47 pm

   Hi Rob -

   Sorry, no. The government considers a duplex to be a real home and, as you’ve owned a home in the last three years, you would be inelligible for the first time home buyer tax credit.

   Kari

5. Rob said at April 1st, 2009 at 9:19 am

   Well that sucks. Again, the government is penalizing the responsible ones. Thanks Kari

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