Who Can't Take First-Time Buyer Tax Credit?

You may already know that qualified first-time home buyers may be eligible to take an $8,000 tax credit for purchasing a principal residence by December 1, 2009, providing the home remains a principal residence for at least three years.

According to IRS tax form 5405, here is a list of factors that would not allow you to take the credit:

Your Modified Adjusted Gross Income (MAGI) is $95,000 or more ($170,000 or more if married filing jointly).


You acquired your home by gift or inheritance.


Your home financing comes from tax-exempt mortgage revenue bonds. This rule does not apply for a home purchased in 2009.


You acquired your home from a related person. Related person includes:
Your spouse, ancestors (parents, grandparents, etc.), or lineal descendants (children, grandchildren, etc.)


A corporation in which you directly or indirectly own more than 50% in value of the outstanding stock of the corporation.


A partnership in which you directly or indirectly own more than 50% of the capital interest or profits interest.
You are a nonresident alien.


Your home is located outside the United States.


You are, or were, eligible to claim the District of Columbia first-time homebuyer credit for any tax year. This rule does not apply for a home purchased in 2009.
Give us a call to make certain the deadline hasn't been extended since this newsletter was published. We can also tell you how much credit you could qualify for based on the price of the home you want to purchase, your income and your tax filing status. Don't delay!