Do you understand the new Stimulus Bill?   Below you will find a great chart that simply goes over the new and old bill.  

 

FIRST-TIME HOMEBUYER TAX CREDIT
As Modified in the American Recovery and Reinvestment Act
New Update- some financial institutions are allowing thie credit
to be used as downpayment.  Hud/FHA allowing it to be
used for closing cost/ buy down interest.

 

Major Modifications Italicized

February 2009

FEATURE

CREDIT AS CREATED JULY 2008 APPLIES TO ALL QUALIFIED PURCHASES ON OR AFTER APRIL 9, 2008

REVISED CREDIT ? EFFECTIVE FOR PURCHASES ON OR AFTER JANUARY 1, 2009 AND BEFORE DECEMBER 1, 2009

Amount of Credit

Lesser of 10 percent of cost of home or $7500

Maximum credit amount increased to $8000

Eligible Property

Any single family residence (including condos, co-ops, townhouses) that will be used as a principal residence.

No change All principal residences eligible.

Refundable

Yes. Reduces (or can eliminate) income tax liability for the year of purchase.  Any unused amount of tax credit refunded to purchaser.

No change Purchasers will continue to receive refund for unused amount when tax return is filed.

Income Limit

Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return).  Phases out above those caps ($95,000 and $170,000).

No change Same income limits continue to apply.

First-time Homebuyer Only

zG??__W??ÐSA?G?_;AYE_Ð??ÐSA?G???_ spouse) may not have owned a principal residence in 3 years previous to purchase.

No change Still available for first-time purchasers only.  Three-year rule continues to apply.

Revenue Bond Financing

No credit allowed if home financed with state/local bond funding.

Purchasers who utilize revenue bond financing can use credit.

Repayment

Yes. Portion (6.67% of credit or $500) to be repaid each year for 15 years, starting with 2010 tax filing.

No repayment for purchases on or after January 1, 2009 and before December 1, 2009

Recapture

If home sold before 15-year repayment period ends, then outstanding balance of repayment amount recaptured on sale.

If home is sold within three years of purchase, entire amount of credit is recaptured on sale. Applies only to homes purchased in 2009.