© 2009 by Michael C. Gray
A monthly report focusing on tax issues for the homeowner and real estate investor.
More on First-Time Homebuyer Credit
Lawrence Allgood of First American Title asked me to tell our
readers more about the limitations that apply for the First-Time
Homebuyer Credit, increased to $8,000 ($4,000 for married, filing
a separate return) from January 1, to November 30, 2009.
The credit will be recaptured if, within 36 months after the
purchase, the taxpayer disposes of the home, or the taxpayer (and
spouse, if married) ceases to use the home as a principal
residence. So, if the taxpayer moves to another residence and
keeps the residence for which the credit was claimed as a second
home or converts it to a rental within three years of buying the
home, the credit is recaptured.
Since the credit is phased out for single persons with adjusted
gross income over $75,000 and for married persons filing jointly
with adjusted gross income over $150,000, most of our clients will
be ineligible for the credit.
Bear in mind I was giving some highlights of the new tax laws. It
was very difficult for me to get a March newsletter out this year.
Since President Obama just signed the stimulus legislation on
February 17, a lot of the details remain to be released, including
hard copy references for tax advisors.
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IRS Circular 230 Disclosure: As required by U.S. Treasury Regulations, you are hereby advised that any written tax advice contained in this communication was not written or intended to be used (and cannot be used) by any taxpayer for the purpose of avoiding penalties that may be imposed under the U.S. Internal Revenue Code.