First-Time Home Buyer Tax Credit Effective Through December 2009

As part of the new economic stimulus bill passed on February 13, 2009, first-time home buyers may take advantage of an $8,000 tax credit on the purchase of a principal residence from January 1 through December 31, 2009.

The credit, which does not require repayment, will be claimed on a tax return to reduce the buyer’s income tax liability. Individuals filing “single” Form 1040 filing status must have an adjusted gross income not to exceed $75,000. Individuals filing a joint return may have income of no more than $150,000. The credit is for 10 percent of the cost of the home, up to a limit of $8,000.

This new tax credit replaces the previous $7,500 tax credit (loan) created by the Housing and Economic Recovery Act in July 2008.

                                                                      
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