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2009 NEW Homebuyer Tax Credit for CURRENT HOMEOWNERS
Internal Revenue Service
www.irs.gov

Program Overview

2009 NEW Homebuyer Tax Credit for CURRENT HOMEOWNERS is a tax credit for current homeowners who purchase a home before April 30, 2010. Property must be located in the United States.

Who is eligible for this program?

Purchasers must have used the home sold or being sold as a principal residence consecutively for 5 of the previous 8 years. Non-resident aliens cannot apply. Dependents are not eligible to claim the credit. A purchaser must be at least 18 years of age on the date of purchase. Household Income Limit: $ 125,000 single; $225,000 married; addl $20,000 phaseout Is this program for first time buyers only? No

Property Eligibility Requirements

The sales price cannot exceed $ 800,000. Allowable property types: Condo, single family detached, co-op, townhouse or something similar. Vacation homes and rental properties are not eligible.

Benefit Details

Under the new law, an eligible taxpayer must buy, or enter into a binding contract to buy, a principal residence after November 6, 2009 and on or before April 30, 2010 and close on the home by June 30, 2010. For qualifying purchases in 2010, taxpayers have the option of claiming the credit on either their 2009 or 2010 return. A taxpayer who purchases a home after Nov. 6 must use the new version of IRS Form 5405 to claim the credit. Likewise, taxpayers claiming the credit on their 2009 returns, no matter when the house was purchased, must also use the new version of Form 5405. Taxpayers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return. A taxpayer who purchased a home on or before Nov. 6 and chooses to claim the credit on an original or amended 2008 return may continue to use the current version of Form 5405. $6500 tax credit for married/filing jointly; up to $3250 for married/filing separately. Benefit: Tax credit of $6500/married filing jointly or up to $3250 filing separately. Homebuyer Counseling / Education Required: No Owner Occupancy Required: Yes Other Program Comments: The new law raises the income limits for people who purchase homes after Nov. 6. The full credit will be available to taxpayers with modified adjusted gross incomes (MAGI) up to $125,000, or $225,000 for joint filers. Those with MAGI between $125,000 and $145,000, or $225,000 and $245,000 for joint filers, are eligible for a reduced credit. Those with higher incomes do not qualify. Members of the Armed Forces and certain federal employees serving outside the U.S. have an extra year to buy a principal residence in the U.S. and still qualify for the credit. An eligible taxpayer must buy or enter into a binding contract to buy a home by April 30, 2011, and settle on the purchase by June 30, 2011.

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