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Don't Hesitate to Use Home Buying Tax Credit When You Can Shave a lot From Your Purchase
"Don't hesitate to use home buying tax"; This is the motto that prospective homeowners are encouraged to repeat to themselves as they hunt for a home. This is especially true now that the government is actually paying people to buy homes. The recession has hit hard, and people are finding it harder and harder to pay for homes. This new form of tax credit aims to give not only the first time homebuyer a financial break, but also helps to kick-start the economy by reinvigorating the flagging real estate market.
But first things first. Let's keep it simple and break it down to a few core questions for starters:
What is the Home Buying Tax?
The legal definition for this new form of tax credit is "The American Recovery and Reinvestment Act of 2009." Simply put, anyone who is looking to buy a home for the first time can shave off 10% up to a maximum of $8,000, a pretty nice chunk of money when you consider the money involved in buying a home. The good thing about this act is that the people don't need to repay this money back to the government, unlike the previous tax credit of July 2008 which was basically an interest-free loan. Yes, the economy is that bad, so don't hesitate to use home buying tax credit to help both yourself and your country.
Who is qualified for it?
The requirements for applying for this home tax credit requires a bit of explaining. The first and simplest requirement is that you should not have bought or owned a home at least 3 years prior to January 1, 2009.
The second requirement is an income limit. You have to earn less than $75,000 in gross income if you are single and less than $150,000 if you are married to qualify for the 10% or $8,000 limit. However, you could still avail of some proportional relief when you earn less than $95,000 if you are single and $170,000 if you are married. Simply put, this means that you are qualified for lower tax credits the more you earn.
So don't hesitate to use home buying tax credit just because you have a calculated modified annual gross income (MAGI) exceeding $75,000 or $150,000. Anything you earn in excess of $75,000 or $150,000 will be divided by $20,000. This value will then be multiplied with $8,000 - resulting in the equivalent tax credit. Having a MAGI of $160,000 still means a $4,000 dollar tax credit when you buy a home for the first time.
Now that you know the basics of the American Recovery and Reinvestment Act of 2009, you can begin to plan ahead in buying your dream house. But you'll have to act fast. This particular act will expire in December 1, 2009 - a few short months away - so don't hesitate to use home buying tax credit and take advantage as soon as possible!
But first things first. Let's keep it simple and break it down to a few core questions for starters:
What is the Home Buying Tax?
The legal definition for this new form of tax credit is "The American Recovery and Reinvestment Act of 2009." Simply put, anyone who is looking to buy a home for the first time can shave off 10% up to a maximum of $8,000, a pretty nice chunk of money when you consider the money involved in buying a home. The good thing about this act is that the people don't need to repay this money back to the government, unlike the previous tax credit of July 2008 which was basically an interest-free loan. Yes, the economy is that bad, so don't hesitate to use home buying tax credit to help both yourself and your country.
Who is qualified for it?
The requirements for applying for this home tax credit requires a bit of explaining. The first and simplest requirement is that you should not have bought or owned a home at least 3 years prior to January 1, 2009.
The second requirement is an income limit. You have to earn less than $75,000 in gross income if you are single and less than $150,000 if you are married to qualify for the 10% or $8,000 limit. However, you could still avail of some proportional relief when you earn less than $95,000 if you are single and $170,000 if you are married. Simply put, this means that you are qualified for lower tax credits the more you earn.
So don't hesitate to use home buying tax credit just because you have a calculated modified annual gross income (MAGI) exceeding $75,000 or $150,000. Anything you earn in excess of $75,000 or $150,000 will be divided by $20,000. This value will then be multiplied with $8,000 - resulting in the equivalent tax credit. Having a MAGI of $160,000 still means a $4,000 dollar tax credit when you buy a home for the first time.
Now that you know the basics of the American Recovery and Reinvestment Act of 2009, you can begin to plan ahead in buying your dream house. But you'll have to act fast. This particular act will expire in December 1, 2009 - a few short months away - so don't hesitate to use home buying tax credit and take advantage as soon as possible!
By Baguio Rose, Ezinearticles.com
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The information contained herein is believed to be accurate and timely, but no warranty as such is expressed or implied.
All rights reserved.
The information contained herein is believed to be accurate and timely, but no warranty as such is expressed or implied.