If you’re an eligible federal employee or qualified military personnel, you have 3 weeks from this Saturday to use the federal home buyer tax credit, and to claim up to $8,000 in federal income tax credits.
According to the IRS, eligible persons include members and spouses of the uniformed services, members and spouses of the Foreign Service, and intelligence community employees who served at least 90 days of qualified, extended duty service outside of the United States between January 1, 2009 and April 30, 2010, and their spouses.
Eligible persons must be under contract for a new home on or before April 30, 2011, with the home’s closing occurring on or before June 30, 2011.
The federal home buyer tax credit is a true credit, too. Eligible buyers receive a dollar-for-dollar tax reduction equal to 10 percent of the subject home’s purchase price, not to exceed $8,000 for first-time home buyers, and not to exceed $6,500 for repeat home buyers.
Repeat buyers must have lived in their “main home” through 5 of the last 8 years in order to be eligibke.
Furthermore, both the buyer(s) and the subject property must meet certain minimum eligibility requirements:
- The home may not be purchased from a parent, spouse, or child
- The home may not be purchased from an entity in which the seller is a majority owner
- The home may not be acquired by gift or inheritance
- The home sale price may not exceed $800,000
- Buyers may not earn more than $125,000 as single-filers; $225,000 as joint-filers
The complete program description is published on the IRS website.
For additional information regarding your tax credit eligibility, you may want to speak with an accountant or other tax professional. It’s often worth the cost.