HOUSING AND ECONOMIC RECOVERY ACT OF 2008 First?time Homebuyer Tax Credit
H.R. 3221 Housing and Economic Recovery Act of 2008
Amount of Credit
Ten percent of cost of home, not to exceed $7500
Any single?family residence (including condos, co?ops) that will be used as a principal residence.
Yes. Reduces income tax liability for the year of purchase. Claimed on tax return for that tax year.
Yes. Full amount of credit available for individuals with adjusted gross income of no more than $75,000 ($150,000 on a joint return). Phases out above those caps ($95,000 and $170,000, respectively).
First?time Homebuyer Only
Yes. Purchaser (and purchaser’s spouse) may not have owned a principal residence in 3 years previous to purchase.
Yes. Portion (6.67 % of credit) to be repaid each year for 15 years. If home sold before 15 years, then remainder of credit recaptured on sale.
Impact on District of Columbia Homebuyer Credit
DC credit not available if purchaser uses this credit.
Purchases on or after April 9, 2008
July 1, 2009
Interaction with Alternative Minimum Tax
Can be used against AMT, so credit will not throw individual into AMT.