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$8,000 Tax CreditAMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 HOUSING TAX CREDIT FREQUENTLY ASKED QUESTIONS On February 17, 2009 President Obama signed the American Recovery and Reinvestment Act of 2009 into law. In particular, the law authorizes a tax credit of up to $8,000 for qualified first-0time homebuyers purchasing a principal residence on or after January 1, 2009 and before December 1, 2009. American Homes has provided the following guidance on how the housing tax credit would impact the industry and our customers. (Please note: This is guidance only, and you should contact a professional tax consultant for a fuller explanation of any particular provision.) Who is eligible to claim the tax credit? First-time homebuyers purchasing a principal residence, either new or resale are eligible for a tax credit of up to $8,000. To qualify for the tax credit, a home purchase must occur on or after January 1, 2009 and before December 1, 2009. For the purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the homeowner. The tax credit will be administered through the Internal Revenue Service (IRS). What is the definition of a first-time homebuyer? The law defines "First-time home buyer" as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law reviews the homeownership history of both the homebuyer and his/her spouse. Does this tax credit apply to manufactured and modular homes? Any home that will be used as a principal residence will qualify for the credit including manufactured homes, modular homes and site-built homes. This also includes homes placed on private land or in a land-lease community, a condominium, or a cooperative. Homes financed using a personal property loan are eligible. How is the amount of the tax credit determined? The tax credit is equal to 10percent of the home's purchase price up to a maximum of $8,000. What exactly is a tax credit? A tax credit is a dollar-for-dollar reduction in what the taxpayer owes. So a taxpayer who owes $8,000 in income taxes and who receives an $8,000 tax credit would owe nothing to the IRS. | Featured Homes
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