Home Buyer Tax Credit

Please consult you tax advisor on taking this credit.

The IRS form can be found by following the link below.

http://www.casagrande-realestate.com/agent_files/Custom_Page_Images/F50505350.pdf

The Following is for informational purposes only. Please consult you tax advisor or the IRS with any questions or concerns regarding your elegibility to claim this credit and required documentation.

Who Can Claim the Credit

In general, you can claim the credit if you are a first-time homebuyer or a long-time resident of the same main home (defined below).

First-time homebuyer. You are considered a first-time homebuyer if you meet all of the following requirements.

You purchased your main home located in the United States:
1. After December 31, 2008, and before May 1, 2010, or
2. After April 30, 2010, and before July 1, 2010, and you entered into a binding contract before May 1, 2010, to purchase the property before July 1, 2010.
You (and your spouse if married) did not own any other main home during the 3-year period ending on the date of purchase.
You do not meet any of the conditions listed under Who Cannot Claim the Credit on page 2.

Long-time resident of the same main home. You are considered a long-time resident of the same main home if you meet all of the following requirements.

You (and your spouse if married) previously owned and used the same main home as your main home for any 5-consecutive-year period during the 8-year period ending on the date you purchased your new main home.
You purchased your new main home located in the United States:
1. After November 6, 2009, and before May 1, 2010, or
2. After April 30, 2010, and before July 1, 2010, and you entered into a binding contract before May 1, 2010, to purchase the property before July 1, 2010.
You do not meet any of the conditions listed under Who Cannot Claim the Credit on page 2.

Who Cannot Claim the Credit

You cannot claim the credit if any of the following apply.

1. The purchase price of the home (defined in the instructions for line 1 on page 3) is more than $800,000. This rule applies to homes purchased after November 6, 2009.

2. Your modified adjusted gross income is:

a. $95,000 or more ($170,000 or more if married filing jointly) and you purchased your home before November 7, 2009, or

b. $145,000 or more ($245,000 or more if married filing jointly) and you purchased your home after November 6, 2009.

See the instructions for line 5 on page 4.

3. You cannot claim the credit for any year for which you can be claimed as a dependent on another person's tax return. This rule applies to homes purchased after November 6, 2009.

4. You (and your spouse if married) are under age 18 on the date of purchase. This rule applies to homes purchased after November 6, 2009.

5. You are a nonresident alien.

6. Your home is located outside the United States.

7. You sell the home, or it ceases to be your main home, before the end of the year in which you purchased it. This rule does not apply if you are a member of the uniformed services or Foreign Service, or an employee of the intelligence community on qualified official extended duty as defined in the instructions for line 12 on page 4 and you sell the home, or it ceases to be your main home, after 2008. You can claim the credit on the return for the year of purchase or choose to claim it on your return for the year before the year in which you purchased the home if you otherwise qualify for the credit.

8. You acquired the home by gift or inheritance.

9. You acquired your home from a related person. This includes:

a. Your spouse, ancestors (parents, grandparents, etc.), or lineal descendants (children, grandchildren, etc.).

b. A corporation in which you directly or indirectly own more than 50% in value of the outstanding stock of the corporation.

A partnership in which you directly or indirectly own more than 50% of the capital interest or profits interest.

For more information about related persons, see the discussion under Nondeductible Loss in Chapter 2 of Pub. 544, Sales and Other Dispositions of Assets. When determining whether you acquired your main home from a related person, family members in that discussion include only the people mentioned in 9a above.

You acquired your home after November 6, 2009, from a person related to your spouse. This includes your spouse's ancestors or lineal descendants (for example your parents-in-law or your stepchildren), and any relationships described in 9b or 9c above that your spouse has.

Amount of the Credit

First-time homebuyer. Generally, the credit is the smaller of:

$8,000 ($4,000 if married filing separately), or
10% of the purchase price of the home.

Long-time resident of the same main home. Generally, the credit is the smaller of:

$6,500 ($3,250 if married filing separately), or
10% of the purchase price of the home.

Phase-out of the credit for homes purchased before November 7, 2009. You are allowed the full amount of the credit if your modified adjusted gross income (MAGI) is $75,000 or less ($150,000 or less if married filing jointly). The phase-out of the credit begins when your MAGI exceeds $75,000 ($150,000 if married filing jointly). The credit is eliminated completely when your MAGI reaches $95,000 ($170,000 if married filing jointly).

Phase-out of the credit for homes purchased after November 6, 2009. You are allowed the full amount of the credit if your modified adjusted gross income (MAGI) is $125,000 or less ($225,000 or less if married filing jointly). The phase-out of the credit begins when your MAGI exceeds $125,000 ($225,000 if married filing jointly). The credit is eliminated completely when your MAGI reaches $145,000 ($245,000 if married filing jointly).

What To Attach to Your Return

If you claim the credit on your 2009 (or later) original or amended tax return, you must attach the following documentation regarding your main home (as applicable). If you do not attach the documentation, the credit may not be allowed.

Attach a copy of your settlement statement showing all parties' names and signatures, the property address, the contract sales price, and the date of purchase. In most cases, your settlement statement is your properly executed Form HUD-1, Settlement Statement.

If you are unable to obtain a settlement statement because you purchased a mobile home, attach a copy of your executed retail sales contract showing all parties' names and signatures, the property address, the purchase price, and the date of purchase.

If you are claiming the credit for a newly constructed home and you do not have an executed settlement statement, attach a copy of your certificate of occupancy showing your name, the property address, and the date of the certificate.

Additional documentation. You should also attach the following documentation, if applicable, to avoid delays in the processing of your return and the issuance of any refund.

If you checked the “Yes” box on line C, attach a copy of the pages from a signed contract to make a purchase showing all parties' names and signatures, the property address, the purchase price, and the date of the contract.
If you are claiming the credit as a long-time resident of the same main home, attach copies of one of the following: Form 1098, Mortgage Interest Statement (or substitute statement), property tax records, or homeowner's insurance records. These records should be for 5 consecutive years of the 8-year period ending on the purchase date of the new main home.

Home Buyer Tax Credit