Filing for the First time Home Buyer $8,000 Tax Credit

It's that unwelcome time of year again...time to start thinking about filing your taxes! Once those W-2 forms, etc. start arriving in the mail, that April 15th tax filing deadline looms over us like a giant vampire with a big black cape ready to envelop us on a dark night.

There is good news for first time home buyers filing their taxes, however, and that is a tax credit from the IRS of up to $8,000! To obtain the credit, home buyers need to file form 5405. If you purchased a home between December 31, 2008 and December 01, 2009, and fit the definition of a first time home buyer, you are eligible for the tax credit. A first time home buyer is someone who hasn't owned a home for at least the last three years and purchased the home as their primary residence. The tax credit is up to 10% of the purchase price, not to exceed $8,000. The adjusted gross income should be below $75,000 for a single person or $150,000 for a married couple filing jointly.

The tax credit can't be file electronically because there were some instances of fraud last year and the IRS is trying to avoid that. And if you owe money to the IRS, the credit will be reduced by that amount.

As you may have heard, the government has extended this credit for first time home buyers. If you have a home under contract by April 30th of this year and close by June 30th, you are eligible for the first time home buyers tax credit.

As with any tax-related information, check with tax professional and/or do a search on the web for more information.