The government’s $8000 First-Time Home Buyer Tax Credit available for Lake Mary Real Estate expires Nov. 30 — a short sixty-ish days from now. When you consider that in the “New World” of Lake Mary Real Estate financing, closings can take up to 45-60 days, first-time buyers have 2 weeks at most to find a home. Buyers that do not have a fully-executed contract by Oct. 15 have little chance of meeting the November 30 deadline and, therefore, little chance of claiming the tax credit. At best – they are rolling the dice. This is especially true for Lake Mary real estate purchases involving short sales… in fact if you are not under contract by around Oct. 7th – you can forget closing on a short-sale in time! My Opinion.
Congress passed the First-Time Home buyer Tax Credit program as part of the 2009 economic stimulus plan. IRS Form 5405 outlines the program criteria and includes the following stipulations:
- A Home buyer can’t have owned a “primary home” in the past three years
- The home can’t be bought from a family member such as a parent, spouse, or child
- The adjusted gross income [AGI] for the household must be below $95,000 [single tax filers] and $170,000 [joint tax filers]
The credit is capped at $8,000 or 10% of the purchase price, whichever is less. And don’t forget — the First-Time Home Buyer Tax Credit is a true tax credit. It’s not a deduction. Follow me here – this means that a tax filer who claims the full $8,000 and whose typical tax liability is $5,000 would receive $3,000 cash from the IRS and have their $5000 obligation wiped out. If you have already paid your 2008 taxes and are filing an amended tax return to receive the credit, you would get the whole $8000 from the US Treasury.
If you can’t close by November 30, 2009, though, you can’t claim the credit.
The clock is ticking. If you’re planning to use the First-Time Home Buyer Tax Credit, the time to act is now.
