Homeward Bound
HOMEWARD BOUND
Answers About The Homebuyer Tax Credit**
Am I Eligible?
If you have not owned a home in the past three years, you may qualify. (Even if you or your spouse owned a home more than three years ago, you are still considered first-time homebuyers and may qualify for the tax credit.) For additional eligibility requirements, visit www.FederalHousingTaxCredit.com
Am I entitled to the full $7,500 tax credit?
It depends on the price of your home and your modified adjusted gross income (MAGI). The credit amount is 10% of the home’s purchase price, not to exceed $7,500. To receive the maximum tax credit of $7,500, you must have a modified adjusted gross income below $75,000 for individuals (or $150,000 for joint filers). If that excludes you, there is a reduced tax credit available for individuals with modified adjusted gross income up to $95,000 (or $170,000 for joint filers).
What is a tax credit?
A tax credit is a reduction in the taxes that you owe. It’s different from a tax deduction, which only reduces the amount of your income that is subject to tax.
How does the credit work?
The credit acts like a loan from the government and must be repaid. The good news is that you don’t have to pay interest, and you can make equal installments over 15 years ($500 a year for 15 years). If you sell your home before then and see a gain, you have to repay the government then. Importantly, thought, if you don’t see enough gain to cover the remaining balance of the tax credit, the law allows that the balance will be forgiven by the government. (Always consult with a tax advisor about your specific circumstances).
What does it mean that the credit is refundable?
If your eligible tax credit is more than what you owe in taxes, the balance will be refunded to you. (To see an example visit www.FederalHousingTaxCredit.com)
How long with the program last?
The tax credit applies to homes purchased and closed on or after April 9, 2008 and before July 1, 2009. That means you can still qualify for the homebuyer tax credit retroactively if you have purchased a home since April 9, 2008.
**How can Anderson Homes help?
As the ENERGY STAR® Leader, Anderson homes has exhibited leadership yet again by partnering with Wells Fargo Home Mortgage to create Priority Mortgage Company, LLC. The staff at Priority Mortgage is available work with Anderson Homes’ homebuyers to help them realize the dream of homeownership in a home that will outperform their expectations. For more information please visit www.prioritymortgagenc.com
