How To File for the $8000 Home Buyer Credit

Obama´s initiative to help first-time home buyers makes it easier to get that starter home. The program guidelines also permit certain existing home owners to benefit from the program. Learn how to take advantage of this current government plan.


 How To File for the $8000 Home Buyer Credit

 The $8000 first-time home buyer credit (also available to some existing home owners) will speed up home ownership. If anyone is interested in buying into the American dream of having their own home, this credit will sweeten the pot. When buyers know how to apply for the credit, they can take the first step towards that new home.

 First-time home buyers (and others) may be eligible for the $8000 credit. Only buyers who use Federal Housing Administration mortgage financing (FHA) can benefit from this program. Home buyers are also expected to put forward at least 3.5% down payment.

 If a buyer purchases a home after November 6, 2009, the income limit (to receive the full credit) for single taxpayers is $125,000 MAGI (modified adjustment gross income). The income limit for married taxpayers who file a joint return is $225,000. The credit is gradually reduced as incomes go above these amounts. The credit doesn´t extend to incomes of $145,000 (single) and $245,000. (married).

 Individuals can file for this credit on their 2009 tax return. Amendments can also be made to a 2008 return. Unpaid taxes, outstanding judgments, or other obligations such as wage garnishments can reduce a credit. Lenders require proof of eligibility for the credit including confirmation from employers.


 Since lenders need to be aware of all relevant financial information, they require a completed IRS Form 5405. The IRS recently announced a revised edition of this form. To receive this credit, a borrower must have the required paperwork.

 The National Association Of Home Builders predicted that this program would inject new life into the real estate market. The $8000 credit and the current market shed a favorable light on home ownership. For interested parties, the present may be the right time. With the holiday season upon us, the $8000 credit might just be the perfect present.