Monday, May 11th, 2009
To All MetLife Approved Brokers
A number of you have asked about the tax credit being offered to first time home buyer if they purchase a home this year up through the end of Nov. 2009. Remember this is a tax credit (sort of a stimulus/incentive to get our industry moving) please note we should not be giving any tax advise on this, you should encourage you borrowers to speak to their CPA, Tax Preparer etc.
Read the following careful and remember to have the borrowers consult their tax advisors.
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What You Need to Know About the $8,000 First Time Home Buyer Tax Credit
March 2009
Who Qualifies for the Tax Credit?
- Never owned a home
- Have not owned a home within the last 3 years--determined by HUD 1 date when previous home was sold
- Purchased a home to be a primary residence between January 1 and November 30, 2009
- Owned a rental property or vacation home which was not used as a primary residence over the last 3 years
- If married and one person owned a home within the last 3 years, the other did not, they do not qualify
- If unmarried and one person owned a home within last 3 years and other did not, they can “designate” the tax credit to the one who is considered the FTHB.
- If parents cosign on a mortgage (and own a home) and the child is a FTBH, they are eligible for the tax credit.
- Non-US Citizens may qualify if they meet resident-alien status (IRS Pub 519)
- Revenue or Housing Bond financing are eligible for tax credits.
Types of Properties
- Primary Residence – Single family, 2-4 units (must occupy one unit) town homes, condos, manufactured homes, mobile homes and houseboats.
- New Construction – “Purchase Date” is the date the owner occupies the home (between Jan 1 and Nov. 30, 2009) Note: They could have owned land and are in the process of building.
Income Limits
- $75,000 Single Person (Partial Credit up to $95,000)
- $150,000 Married Couple (Partial Credit up to $170,000)
- Based on Adjusted Gross Income (AGI) line on IRS Form 1040, 1040A or 1040EZ
Amount of Credit
- 10% of Sales price
- Up to Maximum of $8000
- Partial Tax Credit if income exceeds $75,000 or $150,000
Repayment Tax Credit
- If sold within 3 years, the entire tax credit needs to be repaid! After 3 years, no repayment is due.
"Buyers should check with a tax advisor on how it will affect their individual tax returns."
Rita L. Kama-Kimura
Wholesale Account Representative
(808) 275-8006
(808) 864-0520
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