First time home buyer tax credit?
I have already filed my 2008 taxes and received my refund. I bought a new home last month and now qualify for the $8000 tax credit and considering amending my 2008 taxes.
Here is my question. I paid 7000 in taxes for 2008 since I had little to deduct. Am I better off to amend my 2008 taxes because my 2009 deductions will be better and my taxes lower or am I sacrificing by amending my 2008 taxes because I only paid 7500?
Are there other ramifications to my 2009 taxes by claiming the credit in 2008?
Also if you pay in $7500 in taxes do you get 8000 or "up-to" $8000?
Who can I go to to see me thru all this if i used turbotax this year for my initial filing?
- hrblock.lauraLv 61 decade agoFavorite Answer
First the tax credit is a refundable credit that if you qualify, you will receive over and above your normal tax refund. So it is not based on your other deductions, since it is not an income tax deduction.
Next the credit is based on 10% of the purchase price on the home up to $8000. So if you purchased for $70,000, the credit would be $7000 and if you purchased for $100,000, the credit would be $8000. There are income limitations associated with the credit, so this could be a reason to either claim the credit with the 2008 or 2009 income tax return. If your income in either year is too much to be able to receive the complete credit, you are able to decide with year to take the credit on.
If you decide to claim the credit on your 2008 income tax return, you are able to take your information to an experienced tax professional to help you prepare the amended tax return, form 1040X.
I have attached a link below to the form 5405, First Time Home Buyers Credit, so you can check to see if you meet all the requirements to claim the credit.
Laura H – H&R Block – Senior Tax Advisor 5
**This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.Source(s): http://www.irs.gov/pub/irs-pdf/f5405.pdf
- 1 decade ago
It does not matter when you take the First Time Homebuyer Credit. The amount of the credit will be the same on either of your 2008 or 2009 tax returns. It is a Refundable Credit so you will get the entire amount no matter what your tax liability is.
The amount of the credit is 10% of the purchase price of your home, up to $8000. If you bought your home for more than $80,000, you can get the max credit $8000.
- 4 years ago
I mailed my 2009 amended taxes on 4/30/2010. (amended because i bought a house). I called the IRS on 6/18/2010 to verify if they received my amended taxes or if there was any other information they could tell me. The woman I talked to said she shows that my check for the 1st time home buyers credit is scheduled to be mailed on 6/25/2010. Which makes it right at 8 weeks. Keeping my fingers crossed that I will actually have the check in my hand this week.
- nova_queen_28Lv 71 decade ago
I believe the credit is calculated "up to $8k". But it is based on something like 10% of your purchase price, up to $8k. So if you spent less than $80k on your place then you might not get the full credit.
Where I live, you'd be buying a total dump that needs complete renovations if you pay under $100k so for my area, there is little doubt that a first time homebuyer would get the full credit.
There are income limits, so you have to watch that, too.
As far as amending '08 vs filing it in '09 - - there are far too many variables to figure out so I would definitely suggest speaking to a tax pro. H&R Block might be a good place to get an opinion since they don't charge you for sitting in the chair, they'll only charge you if they amend your return.
They can figure out what would work best for you based on your income and current situation and they can try to anticipate changes for '09 taxes and help guide you.
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- Ali MLv 41 decade ago
I believe it is better to take the credit now. If you don't need the money, invest it and make money on it. It is better not to lose a year worth of interest than having a 0 interest.
This credit does not affect how much you paid in already or how much refund you have received.
You will need to do an amended return 1040X.
- JssLv 71 decade ago
You should file amended tax return and get the money.
If you purchase home after Dec 31, 2008 and before July 1, 2009, you will get up to $8,000.
- Anonymous1 decade ago
I prepare taxes for aliving. You are better off to claim the first time home buyers credit next year when you file your 2009 taxes because Obama passed the bill to where next year you want have to pay that money back. If you do an amended 2008 return you will only get 7500.00 and starting in 2010 you have to start paying 500.00 a year for 10 yrs until you get it payed back. What they will do is deduct the money from your return every year. Go to www.irs.gov and it should explain it on their site. Next year you can claim it and receive 8000.00 and never pay it back.
- Anonymous1 decade ago
I am far from a tax expert, but you may want to take a look at this site. They have some info on the first time home buyer credit. I hope this helps!
- MickiLv 61 decade ago
you need an accountant