SAHBA Home Hints
September 14, 2008
Government's $7,500 Tax Credit Makes Owning a Home a Reality
When was the last time you were offered thousands of dollars interest free?
Thanks to the recently passed Housing Stimulus Bill, qualified, first-time home buyers have this opportunity by way of a $7,500 tax credit. A first-time home buyer is a buyer who has not owned a home during the last three years.
“Ending the housing downturn and mortgage crisis is critical to the vitality of Southern Arizona 's economy,” said Randy Agron, Chief Financial Officer of A.F. Sterling Home Builders. “Protecting and expanding the American dream of home ownership is proven to promote strong communities and a strong economy.”
Income Limits
Home buyers who file as single taxpayers can claim the full $7,500 tax credit if their adjusted gross income (AGI) is less than $75,000. For married couples filing a joint return, the income limit doubles to $150,000. Single taxpayers or married couples can receive a partial credit if the AGI is between $75,000 and $95,000 or $150,000 and $170,000 respectively.
Claim the Credit
Potential home buyers can claim the tax credit on their federal income tax return. No other applications or forms are required. No pre-approval is necessary.
Payback Provisions
The tax credit operates like an interest-free loan to be repaid over 15 years ($500/year) or when the home is sold. If there is insufficient profit, then the remaining credit will be forgiven.
Effective Dates
The credit is available for buyers who close on the sale of a home on or after April 9, 2008 and before July 1, 2009. Only a home that will be used as a principal residence qualifies for the tax credit.
“The Housing & Economic Recovery Act of 2008 (H.R. 3221) is an important step in the right direction,” said Agron, who is SAHBA's current Chairman of the Board. “People will be able to buy the new home of their dreams when their existing home can be sold with a $7,500 tax credit to a new home buyer.”
Details: www.federalhousingtaxcredit.com.
SAHBA represents about 750 member businesses and 40,000 jobs serving the residential construction industry in Pima and Cochise counties.
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