Will taxpayers who do NOT itemize be able to use the car sales tax deduction?

Notable, will check this one out for you ... I'm hoping you can, because you don't need to itemize to get the education credits, so why would they require it on this one? --- lfk.

Is that "new car purchases" include used car purchases (new to me) or is it explicitly a "new car"?

I believe it's new, not a used car. eileen

Yes, you don't have to file an itemized return to get the sales tax deduction. eileen

How will the home purchase tax credit work?

Just looked up the language in the bill. The credit is for first-time homebuyers who purchase a house this year through the end of November. It's worth up to $8,000, which you can claim on next year's tax return. - eileen

Does this stimulus package include a provision to not tax unemployment payments to laid-0ff workers?

It appears that this provision not to tax unemployment benefits for 2009 only has made it in the negotiated bill. - eileen

Is it known if the $8000 tax credit can be split over two years to maximize the credit for those of us who do not pay $8000 a year in federal taxes?

I bought my house on January 28th, however, I already filed my taxes and I am getting the $7500.00 tax credit, however, what do I do now that it has increased to $8000.00 and I think has to be claimed in 2009...

Good question. Not sure whether you will have to file an amended return or not. I'll try to take that up with the IRS and see what answer we get. - eileen

From what I've heard the Work Pay Tax Credit amount to about $15 per pay period. Wow! Not really going to make much difference at all in my pocket to help stimulate the economy.

Last year's stimulus checks worth $300 to $1,200 or more, tended to be used to pay off debt or to add for savings. It wasn't stimulative. Chances are an extra $15 a week in a paycheck will likely be spent, not saved or applied to debt. All those $15 a week increases in paychecks add up to $140 billion. That could be quite stimulative. - eileen

Will the first $2,400 of unemployment benefits be free of federal tax as a result of this bill?

Yes, it appears so. But only for this year. - eileen

Thank You Eileen for posting my question, please, if you do get an answer, I would appreciate anything you find out. I dont want to lose out on the additional money, and obviously, I dont want to have to pay it back if I dont have to...

You're welcome. I'm thinking if I get more questions and the legislation passes both House and Senate today, I'll try to answer all the questions in Sunday's paper. So, if you have more questions, let me know. cheers, ema

I have read what a 1st time home buyer is, but wondering if there are any clauses that give other possibilities. I bought a town house 12 years ago and am about to sell it. I will then close on a new house a couple of days later. Can I not be eligible for a Tax Credit???

There is some wiggle room, but it won't apply to you. You must not have owned a house for the prior three years to be consider a new homebuyer. Sorry. - eileen

Eileen - The $15 is per pay check not every week and yes when you add it all up it seems like it is a big amount that could be stimulative but honestly $15 every 2 weeks is not a large amount but nowadays what is that extra $15 going to buy. Maybe a tank of gas. I guess I see things different. I used my last stimulus and got new speakers put in my car and used the rest of it to take the family to St. John for a week. Send me another $1200 and I will gladly spend it at Woody's Saloon and The Beach Bar in Cruz Bay.

To be clear on the form of the homebuyer credit - let's say this year I am getting $2,000 back in taxes. If I buy a house this year before November, and for the sake of argument all else is equal, I would get a $10,000 refund next year, never to be paid back?

Good question. I'll check on that. What you are describing is a "refundable" credit, where even if you don't owe taxes you will get money back through a refund. Credits generally reduce your tax liability dollar for dollar. - eileen

I know the homebuyer credit was initially going to be $15,000. I guess now it has changed to $8,000?

Also, I heard that there was an income cap on this tax credit. Is this true, and if so, what is that income cap?

Yes, starts phasing out at $75,000 for singles; double that for married joint filers. - eileen

We are scheduled to close on our home purchase next week. We have not filed our taxes yet. Can the $8,000 credit be applied toward our 2008 return, or do we have to wait until 2009? The previous credit allowed filers to choose whether they wanted to use it on the '08 or '09 return.

I just checked with a tax specialist, who says, yes, you can apply for the credit on your 2008 return - eileen

We are scheduled to close on our home purchase next week. We have not filed our taxes yet. Can the $8,000 credit be applied toward our 2008 return, or do we have to wait until 2009? The previous credit allowed filers to choose whether they wanted to use it on the '08 or '09 return.

Another good question. I'm thinking you will be able to take it on your 2008 return, but I'm going to check with a tax guru. I'll keep you posted.

From reading the language of the compromise bill, it looks like those of us who bought a house last year and took the $7,500 credit on our taxes this year will still have to repay our "credit," while those who buy after Jan. 1 this year will NOT have to pay it back. Seems a bit unfair to have this double standard. I took the credit knowing I would have to pay it back, but it still irks me that it wasn't made to be retroactive.

You're right. I'm sure a lot of people will be unhappy. But then again, anyone who bought a house before April 9th last year, didn't get the credit you got, either. - eileen

Will the $8,000 credit be "refundable" like the original house bill of $7,500 or "nonrefundable" like the $15,000 senate bill?

It's refundable. - eileen

So what does this mean for States that have no sales tax???

I just bought a car a week ago since I wrecked my other one. Now i'm reading that you can only deduct the sales tax?

Oregon doesn't have sales tax.

Hmmmm. Well, lit looks like you already have a tax break because you don't have to pay sales tax like they do in other states. But I'm talking to some tax experts and ask about your situation.. - eileen.

i closed on my home end of oct/beginning of novemebr--all i can do is get the 7500.00 and pay it back??

Yes, but life's sometimes unfair. At least you got a credit. Other readers are kicking themselves for buying a house before the April credit took effect. - eileen

I currently own a home. But if I buy another home this year with someone who is a first time homeowner, will that person be able to claim the $8000 credit (as a co-signer)?
Hi, I just ran your question by a tax expert. but we don't have enough information to give you an answer. Will the other person be living there or not? Will you? The credit isn't for houses purchased as an investment. Also, are you a parent helping out a child or a newly married couple buying a house together? - eileen

What happened to the tax credit for other than first time home buyers? This was reported a few days ago. My wife and I used that as our decision to buy -and then to move into- our retirement home this year. If it is not in the bill, we will not buy that house this year.

That $15,000 credit for any home purchase didn't make the final cut. - eileen

so if i purchase a house between now and november I am going to get at least $8000 that i only have to pay back if i sell in theh ouse in 3 yrs. otherwise I get an $8,000 gift from gov't.

The credit is 10 percent of the house purchase, up to $8,000. You won't have to repay it if you keep the house at least 3 years. - eileen

I read in the original bill that in order to recieve the 15,000 tax credit you were required to put 5% down on the house. Does this apply to the 8000 tax credit? The reason I ask is that the typical FHA loan for the first time home buyer requires under 5% down.

I haven't heard that, but will see if I can find an answer later. eileen

I am buying a house for $71,000, so I will be getting a $7100 amt back on my taxes, correct?

Yes, it's 10 percent up to $8,000, so you should get $7,100 back. Congrats!

My daughter recieves SSI for her disability. Will she get the 250.00 and if she does do I fill out anything for it?

Recipients of SSI are eligible, but the tax professional I spoke with says when and how that will be paid out hasn't been laid out yet. - eileen

To clarify, yes the other person will be living there as his primary residence. I will be a co-owner helping to purchase the home.

Sorry, I don't know the answer to this. I spoke with a tax professional, who wasn't clear either. You will need to talk to your accountant or contact the IRS after the legislation becomes law. - eileen

we closed on our home november 2008 can we still get the 7500. i dont have a problem paying it back,just puting it with another 5 grand to refinance from 6 to 4.5%.

Yes, if you purchased a home as of April 9 last year, you would be eligible for the credit of 10 percent of the home's price, up to $7,500. There are income limits, with the credit starting to phase out once income reaches $75,000 for singles, double that for couples.- eileen

I am kind of confused here. I purchased my home in 12-31-08. In what category am i in? Plus i made more than $95000 because i worked overseas. Does this bill have an upper limit at $95000 as previously stated for single?

If you purchased it last year, you are eligible for the credit worth up to $7,500 that must be repaid. That credit starts phasing out once income reaches $75,000, but, sorry, I don't know the income amount before the credit is fully phased out. if I find the answer, I'll let you know. You might also check the IRS Web site. - eileen

Someone in Congress needs to look up the word "stimulus". This does nothing to stimulate the economy regarding money available to consumers to "spend" and get retailers back on track. The small business owners of this country are the ones going out of business. They are the backbone of this country and they're getting screwed AGAIN. $15 per payperiod or $140 billion as you call it, will stimulate NOTHING. Show the people of this country that someone in DC cares and by putting real money in peoples pockets - the thousands that went to the greedy oil companies in the summer of '08 and we'll respond by spending the money. Please tell me what I can purchase for $15 a week?

As a follow up to my prior question, please tell me how I can purchase a car, a house, floor covering for my home, a major appliance, etc. on this major stimulus of $15 per paycheck? Also, what about the thousands of unemployed who don't get a paycheck? Unemployment benefits of a maximum $380 per week is a joke! That's about $20k per year. The layoffs that are occurring are mostly white collar jobs of people making more than $50k per year. How does $380 per week pay their bills? I hope Congress has another "stimulus" package for the PEOPLE and not the joke that was just passed. I don't get it. Please explain how this is going to help the economy NOW, not a year from now.

My husband and I are both retired and receive Social Security Benefits in addition to other retirement income from the private sector. Does this mean that we get $250.00 a peice as a result of the stimulus package. I guess its enough to pay BGE, we should be grateful.

It appears so, but as I wrote in Sunday's column, the details about the $250 and when and how it will be paid out are unclear at this point. - eileen

How about this scenario? In June 2008 I sold the townhome my wife, kids and I lived in for nearly ten years and purchased a single family home for four times what I paid for the townhome. I put 20% down which is a security blanket for the bank, paid closing which stimulated the financial institute, real estate agents and local, state and federal government. Did I mention the jumbo interest rate? I see nowhere in the stimulus package that I will receive any benefit for doing my part? Am I missing something?

You might not get the first-time homebuyer credit, but there may be other things in the package that you will receive. - eileen

Last year's stimulus checks worth $300 to $1,200 or more, tended to be used to pay off debt or to add for savings. It wasn't stimulative. Chances are an extra $15 a week in a paycheck will likely be spent, not saved or applied to debt. All those $15 a week increases in paychecks add up to $140 billion. That could be quite stimulative. - eileen

And where did you get this unprovable data from Eileen? If you think 15 bucks a week for a family of 4 which is the equivalent of buying your 2 kids a Happy Meal creates jobs ( which is what this is supposed to do - then you are living in "Happy Land".

What specifically are the tax cuts for small business owners like me, that were promised by Obama in his campaign? I am not talking about breaks for providing employee health care, I am talkining about REAL cuts and incentives to spurn capital investment and growth.

Hi, My wife and I are looking to re-finance ( we already started the process). My question is..I am on disability and I am not on the 1st mortgage for our house..But in the refinance I am going to be on the mortgage,I have never owned a home before..Will I be eligible for this tax credit?

I'm sorry, I don't think so. First, the house is already purchased, you are just refinancing the mortgage. Plus, a tax professional I spoke with mentioned that there were limits where one spouse has owned a house before. - eileen.

Is the tax credit for the Hope scholarship a reduction in taxable income or a reduction in taxes due...the word seems to be used differently

Thanks!

It's called a credit, so I would think it would reduce your bottom line tax bill dollar for dollar. - eileen

Kudo's to you !!!!
This is soooo refreshing to read.

This is the kind of stuff that the average joe need to read/hear. If others would explain what is going on and what to do, in layman's terms, I think that the american public will continue to stay onboard as they are.

The current Republicans continue to disagree with the stimulus package but does not explain why they disagree. Come on Republicans, let it go and stop showing the world your ingnorance and lack of tolorance for someone who does not look or think like you.

More of you should have had the balls to reach out a hand and join the Obama team even if you disagree. That's what teams do ........
Shame on you!

This column needs to be printed nationally for all to ask questions that are revelent to their situation and get an honest answer.

Glossing over the situation this new stimulus bill has created with saying "sometimes life is unfair" is astounding to me. Congress has decided to put the screws to thousands of taxpayers by modifying the Bill they passed last year. Instead of altering the entire time frame, they decided to alter only a portion. That should be unacceptable to the people affected, not shrugged off. Not only do first time home buyers from last year have to pay back the credit if they decided to take it, now they have to pay for someone else's free money this year. They should be unhappy, and the should let their representatives know about it. There was nothing wrong with the original Tax Credit, and if it really was such a failure, then why not alter credit for the entire time frame?

OK, if i am thinking that I might buy a house this year, when can I ask for the tax break? right now that I file my taxes for 2008 or would I have to wait until I buy the house and do it for my 2009 taxes??

The tax pros that I spoke with say if you buy a house in the near term, you would be able to take the credit on the 2008 tax return. - eileen

This year is full of changes for me. I graduated from the University of Maryland with a teaching degree. I also got married in July and we bought our very first home for $206,000. My wife is a second year teacher with a combined house income of $84,000. Can you please tell me what my wife and I are entitled to this year? Thanks!

Congratulations. Since you bought your house last year, you would be eligible for the credit that's worth 10 percent of the house price, not to exceed $7,500. The phase out for couples starts at $150,000. So it looks like you will get the $7,500 credit, but again, this one will have to be repaid over 15 years. - eileen

Is every worker who is making under $75,000 and is single getting the "Making Workers Pay Credit"?

They should. - ema

I have just purchased a home in Baltimore in November 2008. Do I qualify as a first time buyer for this.

As long as you haven't owned a house in the prior three years, you do. - eileen

I am about to purchase my first house. Previously I owned mobile home but rented the land it was on. Do I still qualify as a first time home buyer?

Sorry, I don't know the answer off hand. I'll ask around. - eileen

I will be closing on my house march 5, 2009 My question is, can i apply for the 8000.00 tax credit this year or do i have to wait till 2009 tax time? I know that the old law was 7500 and you had to pay back but the 8000 doesn't have to be paid back unless you sell in 3 years. thanks

As mentioned earlier, tax professionals I spoke with indicate you could take it on your 2008 tax return. - eileen

I don't remember the exact numbers but from what I remember is that the cost of the bill averages out to about $6000 or $8000 per household. Please correct me if I am wrong but instead of giving me $15 every 2 weeks give me that 6 or 8 thousand and I can get new hardwood floors put in my house or replace my deck or something. I think that will do a lot more to stimulate the economy. I was out at Best Buy this weekend and in the 15 minutes I was there I saw 4 new HDTV's go out the door so somebody must be out there spending money.

How does the $8K tax credit work? Will those who qualify receive a check after they've filed their taxes. Or is it really a "credit" whereas you're tax deductions will be lower? I'm trying to figure out if I will actually receive an 8K check or not...

The credit is worth 10 percent of the purchase price of the house, for a maximum credit of $8,000. It's a refundable credit, so if you don't owe any taxes, you will get the credit as a refund. - eileen

I would just like to know if I take the $7500 tax credit do we have to pay it back?

If you purchased your first-home last year, from April 9 through Dec. 31, you will have to repay the credit. - eileen

I believe last year's $7500 was not available to the spouse of someone who was a homeowner that lived in the same house, even if that spouse had never bought a house. Do you know if the same limitations apply? My wife and I are buying and want to know if she who has never owned a home would be eligible even though she has lived in the house that I own for the last 3 years.

I was just looking through the stimulus legislation. I could have missed it, but It doesn't mention changing the spousal ownership limits that you mentioned, so it's likely they still apply. I'll post something if I hear differently - eileen

To file for the $8,000 Tax Credit for 1st Home Buyers do you have to file on a "long form"?
Patty H.

Not sure, but you would probably want to file an itemized return anyway so you can deduct the interest on your mortgage off your tax return. - eileen

I purchased a house with my first wife. She got the house in the divorce. I am remarried now. Would my new wife and I qualify as first time home buyers?

Have you or your new wife owned a house in the past three years? - eileen

No we have not owned at all since getting married to second wife

I am on disability and just purchased my first home, even tho I do not regularly file taxes, do I qualify for the first time home owners tax credit? I just purchased my home This January.

It appears so, but you will have to file a return to claim it. - eileen

I currently make just below $75K a year. However, around August of 2009 I'm expecting to be bumped above the 75K salary. Two questions: If I purchase a home before November of 09' can I claim the $8000 credit for tax season 2009 even though my salary increased during the year. Any definitive last day a First-time homebuyer must purchase a house to claim the credit on 2008?

You have to buy the house before you take the credit. So, you can claim the credit on 2008's return as long as you have purchased the house before filing. The tax deadline is April 15th, but you can file an amended return, I suppose.

The credit starts to phase out at $75,000 but I don't know when it completely disappears. So, even if your income gets a boost, you could still be eligible for a smaller credit. - eileen

I am just wondering about the work credit. I believe that i have seen that it is for 250$ for who ever is working. My question though is unique though because my wife is employed, but she is currently on workers compensation due to an injury. Further into detail though we now live in California and have for all of 2008 which is where we will be filling our taxes but since she was injured in Washington, she does not have to file any taxes, federal or state. So will she still be entitled to the work credit since she is technically employed?

I'm not sure. Check back on the blog where I'm posting readers' questions to the stimulus law. - eileen

My fiance & I will be buying a house this year, most likely after graduating from dental & pharmacy school in June. For the 2009 year, we will be under the 75K income limit. But in 2010, we will be over the 75K limit . . can we still claim the $8K first-time homebuyer's credit??

If you buy the house in 2009, you will get the credit on your 2009 return. It doesn't matter what your income is in 2010 - eileen

My husband and I are in the process of building a house that won't be finished until june. We dont start paying our mortgage until it is finished but technically we closed in November 2008. Which credit would we be eligible for?

I forward this to a tax pro. check the blog for the answer - ema

Is the first time homeowners credit income phase out based on actual income earned or based on AGI?

AGI - ema

I took the $7500 credit this tax year for my home purchase, and I understand that I must repay it over 15 years, however I do not understand what happens if I sell my house in the next 15 years, must I repay it at closing? I doubt I will want to be here 15 years this is my first home.

This answer was posted. - eileen

Regarding the $8000 tax credit... doesyou the credit covers tax liability only or can it be refunded? In otherwords, if a Buyer can benefit from the full $8000 and they would normally get a refund of $750, would they now get a refund of $8750?

Yes, the credit is "refundable," so you will get the excess credit in the form of a refund if you don't owe taxes. - eileen

Since new home buyers can treat a 2009 purchase on 2008 taxes, can I claim my Sept. 08 home purchase as a Jan 1, 2009 purchase and claim the 09 credit to take advantage of the better of the two?

No, sorry - ema

I would like to speak with someone about the new changes that went into effect today with the First TIme Home Buyers Tax credit. There were several changes that were made that I have issue with. I believe that this new changes violates tax payers rights according to the TITLE XI—RELIEF FROM RETROACTIVE
APPLICATION OF TREASURY DEPART-
MENT REGULATIONS
SEC. 1101.

My first complaint is that the law for 2008 was for a credit for homes purchased in April 2008 to June 30, 2009. The new credit in effect was made retroactive to Jan 1 and extended until Dec 09. Now the old credit captures roughly half of the people who originally qualified for the tax requiring repayment. While the other half, those who fall in 09 are retroactively able to take advantage of a larger credit with no repayment (provisions being they remain in their home for three years). I feel this new law has violated taxpayer rights and was inequitable initiated.
I could see making the changes effective June 1 when the other credit would have expired or making it effective today when the law was signed as being fair and following tax rights but not retroactive for some who qualified for the same original credit.

What can be done about this unfair change in the tax law?
How can we get someone to take a look at it again?

Try your representatives in Congress. - eileen

if I owned a home for 10 years before getting married to my wife and then added her onto the deed of my house...but she is not on the mortgage does she lose her ability to use the first time buyer credit?

Is she buying a house? - eileen

I closed on my house on Jan 21st, 2009 and filed my taxes on 2/14/09. How can I get the new tax credit for first time home buyers? If I can get $8000 with no payback I'd rather have that than the $7500 with payback over 15 years? Can I amend my taxes? Thanks, K

So did you already claim the $7,500 credit on your 2008 return? If so, check tomorrow's Q&A on the blog, amending returns is one of questions. eileen

Eileen,
You asked is she buying a house? We are looking at buying a new house and want to qualify for the tax credit is there any way that we could qualify even though I have owned a home and my wife is only on the deed as I owned it before we were married. If she was to purchase the home only in her name would that qualify for the credit?

If she's on the deed, she is part owner, right? I don't think she would qualify, but I can run it by someone. - eileen

Hi. My question is re: the older version of the first time homeowner credit. I sold my former home on 2004. I was married for 2 years after this to someone who owned a home. I was never on the deed or the mortgage. I bought a home in 2008 after I was divorced. Do I qualify for the credit? I want to make sure I am doing the right thing. Thx

I'll run it by some tax pros. Check the blog because I'll post the q&a along with others when I get answers - eileen

Hi There,

My husband and I are currently at a debt-to-income ratio of 43% of our mortgage payment from our monthly gross income. Our mortgage was underwritten by Freddie Mac, and sold to another bank- who said that as they have no mortgages in default, they will neot be participating in the Homeowner Affordability and Stability Plan. We really need to refi. to a lower rate. We are bot employed, have minimal debt, and low cc balances. Would we be able to refi. with another bank under this plan?

Sorry, I don't know. I have heard that more details will be coming out in March on this program, so maybe we'll learn more later. - eileen

I wasn't sure. Because I didn't qualify for the $7500 credit since it was family. So I didn't know if this one had the same stipulation. Just wondering because it doesn't matter, I'm going to spend every bit of it to fix the house up.I also bought a car this month, and me and my wife are going back to school. Can we expect each credit?

I'm forwarding a question similar to yours to a tax accountant. ICheck the blog later for the answer. - eileen

I'm scheduled to be married in June, 2009 and have never owned a home, but my fiancee has. Can we still qualify for this deduction if we are not married before we purchase? If I leave her off the deed? but still on the loan? Can we just amend our 08 filings to include the home? Too many questions...

I forwarded this question and others to tax pros. When I get the answers, I'll post them, check the blog later. ema

Hello.....
My husband and I are buying a house this year, closing June 1st. We were told that we could amend our already filed tax return for this year to get the $8000 credit. Is this true?

Thanks!

That's what the tax pros say, but you must buy the house before claiming the credit. - ema

I filed my taxes on Feb 12th and claimed the $7500, but I am not closing on my house until Feb 26th, are my taxes going to be rejected? Will I just get the amount of my refund minus the $7500? Or will I have to amend my taxes to claim the $8000?

Check the blog's Q&A on the economic stimulus package about filing an amended return. - eileen

i was wondering if the 8,000 could be applied as a down payment and taxes on a house just i would not see the money it would go towards the house it just wouldnt be paid now something like getting a credit.

No, you must buy the house first to get the credit. -ema

i was wondering if the 8,000 could be applied as a down payment and taxes on a house just i would not see the money it would go towards the house it just wouldnt be paid now something like getting a credit

No. You have to buy the house first before you claim the credit. ema

I had a followup for a previously asked question. I currently own a home. But if I buy another home this year with my future wife who will be a first time homeowner, will she be able to file an amended return and claim the $8000 credit (as a co-signer) in 2008 since she already filed as a single person, and since she can't claim it in 2009 since she will be married to a person that already has a house. We are about to be a newly married couple but are planning to buy the house before we are officially married. We will both be living at the new house, and I plan to keep my old house (that only has my name on the title) as an investment property. Any insight you can provide will be most helpful.
Thank you Eileen
I forwarded this to a tax professional, and waiting for an answer. I'll post it online when I get it. ema

Eileen,
My wife and I are teachers in New Mexico (the last 16years). We have never owned a home and are considering purchasing our first home in the Phoenix area (where we plan to retire). We still have several more years of teaching in New Mexico but with the price of homes in Phoenix now seems to be a good time to buy. My question is would we qualify for the $8,000 tax credit?

You must buy the house between Jan. 1 and through Nov. 30th of this year to qualify for the $8,000 credit. - ema

I'm about to purchase a home through FHA and I'm a first time home buyer, I was approved back in October but I did not find a house within the 90 days. I had to reapply now the guidelines have change in dealing with the ratio. I may have to have a co-signer. If my sister co-sign, she does on a home and she will not be living with me, would I be able to receive the 8000 tax credit?

Is your sister going to be on the deed? - ema

My daughter and son-in-law plan to build a new house once all the permits go through. The ground was given to them by his grandmother but they will be paying for the building of the house. Do they qualify for the $8,000.00 tax break? It should be built by October 2009.

I don't see why not. A similar question was asked on this consumer blog, and the tax professional wrote that "the credit would be available for the construction of the house as long as it became" the principal residence upon completion. Check the blog under taxes for more details. - eileen.

ema- she will be a co-borrower so her name will be on the deed.

Sonja, I just posted a Q&A on the first-time homebuyer credit. It appears it may not matter whether her name is on the deed or not. Check out the blog. I hope that answers your question! eileen

Hi,

I bought my first house Dec 1, 2008 and thought i was eligible for the first time home buyers credit. My ex husband put me on the deed of his home with a quick claim with his parents with rights of survivorship in july 2006. There was never any mortgage on the house and it was owned outright (his dad bought it) anyway, we divorced in oct 08 and did a quit claim and i am no longer on the house. i didnt think that would be an issue until my accountant said no i did not qualify because i had an interest in a home within three years is this correct?? its so upsetting as me personally this is my first time buying owning. any thoughts or advice are appreciated!! thanks, inger

The law does say you cannot have owned any interest in a house for the previous three years to be considered a first-time homebuyer. It already sounds like you have professional advice, so I don't know what I can add, sorry. ema

I bought my house in Dec 2008 My first morgage payment wasn't due until Jan 2009 do I qualify for the $8000

No, I don't think so. You bought it in December. You could qualify for the $7,500 credit that must be repaid, though. - ema

I have never owned a home. My girlfriend owns a home and is looking to refinance it. If I am on the new refinanced morgage with her, does that qulaify me for the tax credit as a first time buyer. thanks in advance

I don't think so. The house is already purchased. The $8,000 credit is for houses being purchased this year through November, not for someone refinancing a mortgage. - ema

Hi! I am planning on purchasing a home in June 2009. I am getting married May 23, 2009. My fiance has owned a home in the past three years. I am not planning on putting his name on anything. If I but the house after we are married but amend my 08 taxes do I still qualify since I was single in 08. I am trying to figure out if amending to 08 will qualify me even after we are married.I forgot to mention I have never owned a home. I think I am in a gray area and no one has an answer. Thanks!!

I run this by a tax pro, so check the blog later for an answer. - ema

I presently own a co-op. Is this considered a"home",thereby disqualifying me from the credit if I purchase a home this year?

I have not agreed with the repubs in 8 years, but they (the majority) are right on on this stimlus bill. That tells me in 8 years they knew the right thing, but did the wrong things anyway. My family makes less the $100,000/yr. We own our home outright. So we are not entitled to any of the $8,000 tax credit. We saw the writing on the wall and paid down our debts. We won't see any of this windfall to offset our expenses like the people who mismanaged, gambled with high risks and lost. You wait, I know yall will be there with hands extended expecting my family to make the repayments for yall. Its almost laughable.

I originally done my taxes at the end of January. I then purchased my new home as a first time homebuyer on feb 13, 2009. I wasnt aware of the tax credit at the time, so i amended my taxes for the 7500 tax credit. Now I see that it has been revised to 8000 for people who buy in 2009 and it doest have to be paid back. Can I amend my taxes again, for this adjustment? and if so, how? What does this mean for me?

Hi, I ran your question by the IRS. You would have to amend your return again, but the IRS suggests you give your first amended return time to clear b efore amedning it again. - eileen

I'm planning to purchase a home this year but might need a co-signer to be approved by my lender. My mom would be co-signing but not living in the home it would be my first home purchase - would I still be eligible for the 8,000 tax credit?

Yes, as long as you purchase by Nov. 30. Check the Q&As on the blog for more details. - ema

I sold my home in May 2006... I purchased a new home on February 27, 2009.... Does this mean I am not eligible for the credit? Is it exactly 3 years to the date?

I'll forward you question to a tax pro, and will post the answer on the blog later. - ema

I was just married in February and now my husband and I are thinking of buying a new home. I have never owned a home before but he has, if I was on the deed and the loan alone would I qualify for the tax credit if i ammended my 2008 taxes? I would love an answer, no one seems to have one!

Check the Q&As on the blog for an answer. I believe both of you must qualify as first-time homebuyers. Plus, you can't claim the credit until you buy the house. - ema

Question on the 3-year home ownership restriction of the Fed Home Purchase credit: Does the 3 year restriction applies to a home owned in Puerto Rico or is it only for Continental US, Hawaii and Alaska?
Reason I ask is that I relocated from Puerto Rico to the states back in Sep 08 because of losing my job. Because of the current job market condition, my wife still works and lives in Puerto Rico in our previous home. We will purchase a home in the relocation area within the next few months and would like to claim the fed credit but there is no information anywhere whether the 3yr exclusion applies out of the contiguous 50 states.
Any information you can provide will be greatly appreciated.

Check back on the blog in the next few days. I'll pass your question onto a tax pro. eileen

Harry Acosta
Irvine, California.

Hello, my niece and her fiance want to buy a house together, both would be first time home buyers. Can they each take the $8000 tax credit? Or would they have to decide on one of them taking the credit?

Sorry, you can't double dip. Check the blog's Q&A on taxes, which describes how two non-married spouses can split the credit. - ema

Confusing, but here goes. I owned a home with my spouse, we filed for divorce. I moved out and rented for the past four (4) years. When it says, first-time homeowner, it says owned a "principal residence" in the last three years. I did not sign over the house until 2-1/2 years ago because of his stall tactics. Again, I did not live there. If I buy a home now, will I qualify for the $8,000 credit? I think so, but wanted another opinion. Thank you.

I think so, too. But let me run your question by a real tax pro. Check back on the blog.

I am wanting to cash in an IRA and use it as towards a home purchase. It would put me above the $75,000 income limitation in 2009. If I buy a house, can I take the credit on my 2008 return since my income will be under this threshold last year?

I'll run this one by a tax pro, too. - ema

My boyfriend was a co-signer on a house for me that I sold 2 years ago, I kept the proceeds from the sale, deducted all the mortgage interest, and the 1099 to the IRS was in my name only. We are trying to figure out if he will qualify for the $8,000 credit?
Thank you.

Is he buying a house? The credit is for someone who actually buys a that's his or her principal residence. - ema

We are a newly married couple and are purchasing a home. Family offered to give us the loan, and we would pay them back like any other mortgage (there will be paperwork involved binding this). Do we still get to claim the 8,000. I had also heard that if we went ahead and got the mortgage from a bank, waited 90 days, then paid it off, we might be in the clear? We'd rather not get the mortgage to begin with...but...ehhh?

All that it matters is that you buy the house. How it is financed doesn't matter. Where did you hear that mortgage information about holding a mortgage for 90 days? - ema

Seems there are two really good places of information out there:
1. Call the IRS...I didn't even know that was possible: http://www.irs.gov/contact/index.html
2. The actual tax form: http://www.irs.gov/pub/irs-pdf/f5405.pdf

The 90 day mortgage thing doesn't seem to be valid (it was from a mortgage broker that wasn't quite familiar with all the rules).

I did run your question by someone. You're fine. It doesn't matter where you borrow the money. You just hve to have your name on the deed. eileen

After twenty years of marriage my husband and I are getting a divorce. My husband has left the country for a job promotion, our new house we purhased together in 2004 has been listed on the market for the last seven months, once the house sells, I will need to purchase a much smaller home I can afford on my own. I will have full custody of our two children ages 14 and 18(college student). Would I still qualify for the $8000.00 tax credit? I have gone on HUD’s website and they have a listed several criteria’s you have to meet just one that would qualify as a first time homebuyer. One of the listed is as followed: A single parent who has only owned with a former spouse while married. With meeting the criteria, I would think I would qualify, it is very confusing. I had asked my realtor and she thought I would not qualify.
I have included the link to where I gathered the definition of a first time homebuyer.
Not sure if this matters our 2008 taxes we are filling our tax return married, his company is actually preparing our taxes due to the foreign tax. 2009 tax return we will file single divorced. He is planning on filing for divorce next week while he’s back in the states. I would assume this would be finalized by the end of 2009.

http://www.hud.gov/offices/hsg/sfh/ref/sfhp3-02.cfm

I am thinking yes, I would qualify.

Let me check with a tax pro. Check back on the blog for the answer in a few days, eileen
Thanks Jennifer

My husband and I were just married. I own a condo which I'll be selling, then we'll buy a new home. Can he take the tax credit? He's never owned a home before. I've heard the answer is no since I own a home now. But, what if we file married individual rather than joint? Would he get half the credit?

I've written about this for tomorrow's paper. Sorry, you both must qualify as first-time homebuyers to get the credit. eileen

Yet another question on the home buying tax credit. It says it goes up to $8000 so if you buy a home for 150K 10% would be 15,000. So instead if you get a tax refund, you'd get the full $8000?

The maximum credit is $8,000. So, if you buy a $150,000 house, you will get a credit worth $8,000, not $15,000. Is that your question? ema

Tax credit discrimination: I just found out that I am ineligible for the $8000 tax credit.I am a U.S. citizen, living abroad and clam the foreign income exclusion. So, the home I wanted to buy would not be my "primary residence" (a requirment for the tax credit).But get this,,,NON-citizens such as non-perm residents, illegals, and others who are living and working in the U.S. legally and illegally qualify for the tax cerdit...IF they have Tax payer Identfication Number (TIN). All they have to do is sign a statement pledging they will lve in the home for three years. No wonder I left the states eight yrs ago!

My wife and I are first time home buyers and looking to get a home and the $8,000 credit. If I had my parents co-sign with me (they are not first time buyers), can I still get the tax credit? I will be living in the home as a primary residence, the parents will not. The home will be on the opposite side of the country from where my parents live. My parents will only co-sign if we cannot get a loan on our own.

Yes, it doesn't matter if your parents co-sign for the loan. You are eligible for the credit as long as neither you or your wife owned a house in the previous three years. - ema

If I am a 1st time buyer, house $150K, salary under the cap, we pay 8,000 in taxes each year.

Does this mean we would get the 8000 back as a refund?

Do you mean you have $8,000 in taxes withheld each year or when you file a tax return you send the IRS an $8,000 check? ema

I am buying a house with a co-borrower and the house will be our primary residence. It has been over three years since I owned a home but it has only two years for the co-borrower. We will both be on the loan document as owners. Will I be able to receive half of the 8K credit?

It doesn't matter who is borrowing the money or listed on the mortgage, what matters is who is on the deed. - eileen

My son purchased his first home in May 2008--what kind of tax break will he receive? thank you

He will receive a credit worth up to 10 percent of the purchase price, but no more than $7,500. This credit must be repaid over 15 years, so it is basically an interest-free loan. eileen

I was taken off a mortgage in April 2006. I was just the co-borrower. I was living with my boyfriend at the time. My husband and I purchased a home in December 2008. Would we be able to qualify for the First-time Homebuyer Credit? Thanks!

You are not considered a first-time homeowner if you had an ownership interest in a house in the previous three years. If you were not on the deed, it seems you would qualify. - ema

My parents took out a line of credit against their home in 2006 to purchase a condo. So the condo is payed off and the mortgage is against their house. Two years later they added me to title but i was not originally on the loan or the purchase. Now i am getting ready to buy a home. Am i still considered a first time home buyer since i have never even applied for a loan?

Hmmm. Don't know. I'm forwarding questions to a tax pro for answers and will include yours. Check back on the blog in a couple of days to see the answers. eileen

I would like my girlfriend to get the credit on her return next year, and want to make sure this scenario is acceptable. Here is the information and the question: I own my home. My Girlfriend does not own the home she shares with me (she is not on the deed or mortgage), nor has ever owned a home. We live together at the same address. She does not pay against the mortgage. Could I sell her my home so that she can claim the credit? I would not be on the new deed. She would then be making the mortgage payments and own the home, I would not own the home. Please let me know what you think, I was considering refinancing at a lower rate, but if she can purchase at a lower rate and get a tax credit that would be a bonus.

What you are suggesting is doing something you probably wouldn't have done otherwise just to get a tax break. A tax professional I interviewed said the IRS balks at people making extreme, out-of-the ordinary moves just to take get tax breaks. You might want to consult with a professional tax adviser for an answer.

Also, not to put a damper on romance, you should also consider that once your girlfriend becomes the owner, she's the owner. If the two of you ever break up, it's her house. Again, I'd talk to a tax pro before making such a big move. - eileen

My husband and I are purchasing a new home in 2009. We've lived in our current residence, which we own, for 7 years. My name is not on the deed to the house, it's only in my husband's name. If my name appears on the deed for our new home, will be qualify for the $8000 tax credit?

Both spouses must qualify as a first-time homebuyer to get the credit. - ema

My brother purshased a house in 2008 and I co-signed. He lives in the house but i dont. Will i be considered a first time home buyer?Am i a eligible for the $8,000? Thank you.

According to the tax professionals, it doesn't matter if you co-signed a loan. If you were put on the deed, then you owned an interest in a house, and that would disqualify you for the credit. You would be eligible for the $8,000 credit if you purchased your first home between Jan. 1 this year through Nov. 30 - ema

I have read through all of the questions, cant find the answer. I purchased a home early 2004, got married late 2004. I am the only one on the deed. We have both lived in the house. We are considering purchasing new home, would my wife qualify for first time home credit? If so, would she have to purchase this home by herself?

Both of you have to qualify as a first-time home buyer. -ema

I was just told I need a co-signer in order to get my FHA loan approved on a condo. My mother (my co-signer) and I are first-time home buyers. Would we each qualify for the $8000 tax credit, or would we each have to split the $8000 tax credit. Thanks!

You can't double up on the credit. You would have to split it. But check the rules on the IRS Web site. The house has to be your principal residence to get the credit. If your mother is not living with you but will be just a co-signer, I'm not sure whether she would be entitled to part of the credit and you might qualify for the full credit if, again, that's your principal residence. - ema

I am a single mother of 3, working two jobs to make sure my kids are taken care of but because I live in a world where I have to work two jobs to put my kids in the right school district, I am penalized at every turn for making "too much" money! I wish I made too much money. What happened to the tax break for 95% of Americans??? Does President Obama mean to tell me that my income of $98,000 per year working two full time jobs puts me in the top 5% of the nation and makes me inelegible for every single aspect of this so called stimulus!! This is terrible. I am buying my first new home after working very hard to come up with some down payment because I make "too much" money for any DPAP and now I find out I can't even qualify for this $8,000.00 tax credit!! I am so angry. I am about to buy a home for 289,000.00 in a struggling economy and I am able to do it from pure hard work as a middle class American and I am the one who gets screwed!! Why is it always middle class America and why does hard work never seem to pay off!!

I am going to forward your message to a tax pro. The credit, as I recall, is for singles whose modified adjusted gross income is under $95,000. Is your income AGI or gross income? You might qualify if it is gross income. - ema

I am a first time buyer of a home. It will be my residence only. My sister is going to co-sign with me, she will be on the deed and mortgage, and owns her home now. Will I quality for the 8,000.00 Credit? Thank you in advance for your answer.

Hi, Check our blog in a couple of days. I'll forward this to a tax pro and combine this with other questions. cheers, ema

I have filed my taxes for 2008. My preparer told me that I was eligible for the $8,000 tax credit if I was going to buy a new home this year(2009). I responded that I thought that I had to purcahse the home first and then apply for credit in 2009. He stated that as long as I purchased before Nov. 31st, it was okay. Was this correct? And if not, how do I correct the situation?

I'll run this by a tax pro with some other questions. I think you are right about having to buy a house first. Check back on the blog in a few days. thanks, ema.

I already claimed my 2008 tax refund and I bought my home a month later...can i still get me $8000 rebate or do I have to wait till next year to claim it

You can claim it now by filing an amended 2008 return. - eileen

Has there been any movement on changing the dates on the $7500 credit so that I don't have to pay it back? I did write my elected officials of my concern for how unfair and arbitrary the date change seems.

thanks

Sorry, not that I have heard of. But at least you got an interst-free loan. Someone who bought a house, say, April 1 last year didn't get a credit because of another cut-off date. - eileen

My parents own a house in Puerto Rico
it's paid off ....they never financed it.
They want to buy a house here in the US and it will be there primary residence they're also senior citizens.
Will they be able to qualify for this 8,000.00 grant since they never owned a home in the U.S?

I can run your question by the IRS in the days ahead if I get some others. But check the blog under taxes. Someone had asked about owning a home outside the U.S., and you'll get your answer quicker. - eileen.

If I brought a home in 2007 but refinanced in 2008 the same home which is my first home. Do I qualify for the credit?

Sorry, no. - ema

Hi, I was divorced 5 years ago, while married, my husband and I refinanced his home in both of our names. When we divorced 5 years ago, I signed a Quit Claim Deed. Would I now qualify for the 8000.00 tax grant?

I think you may. I'll run it by the IRS just in case. Check back on the blog later this week. - eileen

I was divorced March 17th 2009. In the divorce agreement, I am purchasing the house for payoff. I am NOT on the current loan and I am not on the deed. We are doing a quit claim deed when my financing is done. Also, our separation was over 5 years and the last 3 tax filing years (2006, 2007, and 2008) we filed separate and I did not receive any tax benefits of the home loan. Would I qualify for the 8000 tax credit on this finance of the house? Also could it be done as a refinance or would it have to be a new purchase?

If you and your ex owned a house in the past three years, you don't qualify. - eileen

I was never on the loan or on the deed. He is doing a quit claim deed to me. I have not had any of the benefits of being a homeowner for at least the last 3 years.

I have a question. My husband and I bought a house 15 years ago and just built a new house July 2009 is when we moved in we are renting our other place to my brother are we eligible for the tax credit for 1st time home buyers? Since it has been 15 years ago since we bought a house? We did live there until our new house was built. Thanks so much

As I understand your question, you still own a house that you are renting. Sorry, you are not first-time homebuyers if you purchased a second house. - eileen

i bought a house with a co-signer and sold it in oct of 06. I just bought a house on my own in April, will I qualify for the 1st time homebuyer?

This question has been answered before, and the rule is you can't have owned a home for three years. Accountants have said you won't qualify, but I will run this by the IRS for you anyway. We are having a live chat on first-time homebuyer questions at noon Tuesday - Sept. 8 - with the IRS on this blog and you can check for your official IRS answer then. - eileen

The good new is that the credit will be extended according to this article ...Has this been confirmed? I hear the senate is debating this. I sure hope it does get extended as cannot afford a house this year.

So far, the credit has not been extended - ema

My only source of income is that of a SSI disability check which I've been receiving since 1994 and always wanted to own a home, do you think I qualify for the $8000 toward purchase of a home?? I've been renting for much to long its time for me to rent to own.
Sincerely/Thanks
Leon

I'm forwarding your question to a financial planner who will be a guest on the blog during a live chat at noon on Tuesday, Sept. 29. You can check for the answer then. Cheers, Eileen

My daughter and her fiance purchased their first home from her grandmother last year in June. I am told that purchasing a relative's home disqualifies you from the $8,000 tax credit. My question is if they were unmarried at the time and purchased as co-owners, can he get at least a part of the credit as a non-relative? Thanks.

Well, first off, to get the $8,000 credit, the house needed to be purchased THIS year. There is a credit for houses purchased last year, but that credit must be repaid without interest. Last year's credit is worth 10 percent of the purchase price, not to exceed $7,500.

I will forward you question to the IRS about purchasing from a relative and whether your son-in-law would qualify for a partial credit. Check back on the blog. - eileen

My husband and I got divorced. we sold our house and I am buying a new one on Nov 1, 2009. I am single parent with 2 children ages 18 and 20, Can I claim the $8000 credit?

You cannot have owned a house in the past three years. Have you? If so, you don't qualify as a first-time homebuyer. - ema

I bought a house by myself in May 2009 and Co-signed for my dad for another house. Will I qualify to get the $8,000 for my house?

You should if you meet the definition of first-time homebuyer, meaning you haven't owned a house in the past three years and this is your principal residence. - ema

Just wanted to add some clarity for the $8000.00 tax credit as I see many comments that you must BUY a home by Nov 30, 2009 to receive it (if you qualify) - please realize it is not that you must BUY by 11/30/09 - you MUST CLOSE on the home by 11/30/2009. Most mortgages, esp conventional loans, are taking 30-45 days to get the loan done - there are very few lenders who can get it done under 30 days. I have worked with a couple of lenders who have been able to get a couple loans done for my clients in 3.5 weeks, and it was rough going. Factoring in the T-Giving Holiday, if you are not closed before T-Giving weekend, I think it is doubtful you would make the deadline. Just be aware of the time it is taking to get loans done, and realize you pretty much have to contract on a home by this weekend to have any hope of a lender making this deadline for you. Carefully choose a lender who can get it done. Generally what I've been finding is that banks can't get a loan done under 45 days - it's been only the independent or private lenders that I've seen able to process a loan in 3.5 weeks. Just wanted to share what I'm seeing happening. If the credit gets extended, then this will be a non-issue, obviously. Plan carefully.

Stay tuned. The Senate moved yesterday to extend the credit. eileen

My husband and I brought a singlewide trailer back in 2006 with his father as a cosigner, well this year we paid the trailer off and brought a new home in just my husband name so we will gett the tax credit, closed on our house may 2009.

I don't think so. Trailers qualify for the credit. The fact that you owned one in the past three years mean you were a homeowner, so you are not a first-time homebuyer this year. - ema

I am supposed to close on Nov 25th. I am a single first time buyer making $85K a year. Under current law, I would receive a $4K credit because of the phaseout. The bill that the Senate approved raised the the range from $75 to $125, which would make me eligble for the full $8K assuming it passes the house and Obama signs it. Do I need to close after Nov 30 to get this additional $4K? A realtor told me it does not matter. What does anyone think?

We are retired military and purchasing our first home and closing Novemeber 30th. I have heard if I am purchasing this home from a family member we will not be eligible for the tax refund. Can you tell me WHY that would make a difference??? Thanks

I think Congress was trying to dissuade very close family members from claiming a sale was a sale when it really wasn't. After all, buyers are being handed $8,000 in taxpayer money, and Congress wanted to make sure it was a true sale, which is the point of the credit. (An inspector general report showed that thousands of people were claiming the credit and never even bought a house. There is legitimate concern about fraud.)

That said, there are some family transactions that are permitted. Check them out at www.irs.gov. - ema