To First-Time Home Buyers: Time Is Running Out on the $8,000 Tax Credit

Posted by ForSaleByOwner

CHICAGO, Oct. 1, 2009 – is reminding first-time home buyers that there still is still time to qualify for the $8,000 first-time home buyer’s tax credit, but they need to act soon. The tax credit is available for a buyer who is purchasing their first home and closes on the sale by November 30, 2009.

“It generally takes 30 to 60 days to close on a real estate purchase, so the clock is ticking for first-time buyers to take advantage of the $8,000 tax credit,” explains Greg Healy, Vice President of Operations for  “The government has set a firm November 30 deadline and there have not been any strong signs of extending it beyond this date. Buyers might be missing out on a great opportunity if they want to purchase a house but wait any longer.”

To help stimulate the housing market, the Federal government earlier this year enacted a tax credit for first-time homebuyers who purchase a principal residence. The tax credit is equal to 10 percent of a home’s purchase amount or $8,000, whichever is less.  In order to qualify for the tax credit, the buyer has to meet the following general parameters:

1. Be a First-Time Home Buyer: The law defines this as a buyer who has not had ownership of any principal residence in the past three years.

2. Buy a Principal Residence: Any home that will be used as a principal place of residence will qualify, including condos, newly constructed homes and manufactured homes.

3. Beat the Deadline:  The real estate transaction will have to close by November 30.

4. Meet Certain Income Thresholds: In order to qualify for the full $8,000 tax credit, a single taxpayer cannot have a modified adjusted gross income (MAGI) that is greater than $75,000. For married taxpayers who are filing a joint return, the MAGI limit is $150,000. For those with higher incomes than these thresholds, the tax credit is reduced and is phased out completely for single taxpayers with a MAGI of $95,000 or more, and for married taxpayers with a MAGI of $170,000 or higher.

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