The housing bill that recently passed may enable you to receive a tax credit for the purchase of your new home at Nature Walk.
Do you qualify?
- The home must be purchased as a primary residence.
- You have not owned a primary residence in the last 3 years. Vacation homes and rental properties do not apply (in other words, you can still qualify if you have a vacation home or rental property).
- Individuals must have an income of less than $75,000 annually and couples must have an income of less than $150,000 to qualify for the full amount.
- The phaseout range begins at $75,000 and ends at $95,000 for individuals, $150,000 to $170,000 for couples.
- The home must be closed between April 9th, 2008 and July 1st, 2009.
- The tax credit is 10% of the home’s sale price, with a maximum of $7,500.
- You can claim the credit on taxes filed in 2008 or 2009.
The tax credit is basically a interest-free loan with some qualifications. You begin paying back this loan within 2 years and then make equal payments over 15 years. When you sell your home, any profit will first be applied to repayment of the loan. If you sell your home at a loss, the difference will be forgiven (though it should be noted that this is recorded as income, as is typical with most loan forgiveness agreements, so you will owe taxes on it).
More information is available at NAHB’s Federal Housing Tax Credit website.
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on Tuesday, November 25th, 2008 at 06:18 and is filed under Ways to Save.
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