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$8,000 First Time Homebuyer’s Credit

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Are you sitting down? Do you have a pen and paper handy? Looks like the $15,000 tax credit to buy a new home has been scrapped, saving $35 billion from the stimulus package, and replaced with an extension to the $7,500 and an increase of that credit to $8,000. The $7,500 first time homebuyer tax credit was set to expire July 1st, this $8,000 provision would extend that. CNNMoney is reporting that the credit is available for those who buy a home between Jan. 1, 2009 and Dec. 1, 2009 (source).

The cost of the extension and modest increase is pegged at around $2-3 billion. Another key provision? The repayment requirement will be nixed. That means the $7,500 15-year loan at 0% interest will now become $8,000 cash money in your pocket. I believe existing borrowers would have that loan forgiven.

Home buyers who hoped for a $15,000 tax credit to buy a new home, as promised by the Senate, will be disappointed. A proposed $35 billion credit to support home sales was jettisoned in favor of a more modest $2 billion to $3 billion provision.

The proposal would eliminate the repayment requirement in an existing tax credit for first-time home buyers, and raise the credit to $8,000 from $7,500. Congressional aides cautioned Wednesday that the credit’s size was still subject to negotiation.

Congress Strikes $789 Billion Stimulus Deal [Wall Street Journal]

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164 Responses to “$8,000 First Time Homebuyer’s Credit”

  1. Sara says:

    FORM ON IRS SITE…. CHECK IT OUT

    http://www.irs.gov/pub/irs-pdf/f5405.pdf

    HOPE THIS HELPS YA’LL!!

  2. Sara says:

    They have the updated forms. Go to the IRS site then forms and publications. Then go to form and instruction number (pdf).. Click where it says posted date. Then it will be the first form. Make sure you have it set going from 2009 and down.

    The 5045 First time homebuyer form is right there for 2009 revised Feb. 2009

  3. jamshed iqbal says:

    i am a first time home buyer i bought a home in 2008 july,what kind of credit do i get,kindly reply me i need a answer.

    • jason says:

      You get a credit for $7500 that has to be re-payed over 15 years with no interest.

      Only homes purchased in 2009 qualify for the new $8000 credit that does not have to be re-payed.

      • Lee VH says:

        I think that the $7500 was regarded as forgivable in Jan 2009. No matter what. I would still check with your accountant to be sure.

        Worst case scenario, by applying it to your loan in 2009 you will still save $8600 in interest as the $7500 is INTEREST FREE!!

        But honestly I think it was ammended in jan or early Feb. to make it 100% forgivable so long as you stay in the home for 3 years! Definately worth the research and the CPA fees!!

        Lee <

  4. kim says:

    Here’s a question for you. Let’s see. $8000 is a little more than 2.5% on a $300,000 home. But, what if (like ALOT of economists are saying) home prices come down over the next year more than 10%? Even 12%!? That would be $30,000 – 36,000 off of a $300,000 home. That means that it could save you much more money to wait and buy a home next year as opposed to taking the $8000 now. (which I think you wouldn’t get until next year anyway.) Imagine, getting that check in the mail, but knowing you could have bought your home for $30,000 less?? And, then you might even get that bigger credit next year anyway. . . anyone opposed to this arguement?? Just wondering. . . We may just rent another year . . .

    • jon says:

      There’s always a risk or prices going down OR up. If you find the right house for you, then I think its a great time to jump into the market. If you want/can afford to wait, give it a shot, never know. Lots of foreclosure deals out there right now.

  5. EM says:

    I had done my taxes early. Purchased a home a little after. $8000 credit comes out and i’m considering an amendment. With the revised version of the form 5045, couldn’t we submit that version of the form if we bought a home in 2009? I don’t mind doing it by hand:)

  6. Steve says:

    I have a mobile that I bought and paid mortgage interest over the last seven years, however, we never could claim it on our taxes because we were renting the pad rent. The trailor was on our personal property but not real estate. Would I still be consider a first time home buyer?

    • Jafway says:

      You could only claim the credit as a first time buyer if the property wasnt yours for 3 years. For instance, if you sold a home Feb 2006, didnt own/tied to any property for three years after, you could claim that credit Feb 2009.

      • Steve says:

        So if the trailor is owned and no mortgage interest claimed, and I paid pad rent during that time, still a first time buyer? That would be great at this time.

      • marion jarman says:

        we have not gotten our homebuyers tax credit yet and having trouble with irs. we have not owned a home for 3 years and 2 months and the irs just does not want to give us the credit. i know i am not the only one who is having trouble. what do i do? i’ve called, my accountant has written a letter to irs and to no avail….

  7. Daniel says:

    Do I have to pay back the 7500 if I bought late November 2008? I would like a sure answer if anyone knows

  8. Steve says:

    If I buy a house in March 09, can I claim the $8000 tax credit on my 08 taxes.

    • jon says:

      Yes, if you already filed your taxes, you can file the amended form, now available on the IRS website (URL is listed in one of the above conversations)

  9. KELLIE says:

    I CLOSED ON FEB 10,2009 I DID MY TAXES ON TUBO TAX 1 WEEK AGO….IT STATED I WAS GETTING 7500.00 BACK….BUT I SHOULD BE GETTING THE 8000.00…WHAT DO I DO KNOW SINCE I ALREADY FILLED BEFORE THE NEW BILL OF 8000.00

    • jon says:

      Not sure what to tell you on that one, except to stop using all CAPS in your conversations.

    • jon says:

      Probably worth a few bucks to take this to a qualified tax person, although my guy was really unsure how it all would work out. They are just getting the correct forms and information this week too, so best bet is probably to wait a little bit for all the forms and information to get out there.

  10. krechman84 says:

    I’m pissed! I bought the day after Thanksgiving, tentativley planning on buying the home Jan 1 2009 but was told by the bank, “were fearful that CREDIT will not be available by then” I was pressured into buying 1 month ealry and didnt make my first mortgage payment until Jan 1. So now, I’ve been screwed by the greedy bank, who got us into this huge nasty mess and now I was just screwed by the government, who bailed the banks out of thier poor business decisions….Leaving us all to pay for thier mistakes.
    Additionally, with the new change to the stimulis, the governments mindset is, “we already got all of the potential money we were going to get from the 2008 buyers” (not enough I guess)….”now what can we do to get more”? I guess they chose to screw those, who they know cant bring them any more real estate cash! (in other words we provide no benefit to them) 2008 buyers (including me) were another victim of our twisted, mutilated, selfish, greedy no good government…..Of which us, our kids, and our kids kids will be paying for the rest of eternity! If the world even lasts that long with all of the GREED!

    • jon says:

      You are still eligible for the interest free loan. So, I don’t think the government is “screwing you” out of any money. Think of all the people that bought last year, the year before, the year before…..and so on. None of them are getting the 8K. This anger is ridiculous. Maybe next year they’ll offer 15K, should all the people that bought this year be pissed too? You bought because it was a good deal for YOU at the time, no one forced you to buy. Get over it.

  11. Brian says:

    The alternative to a “stimulus package” is very simple. Do nothing. Let the markets sort it out without government interference, which is, by the way what got us into this economic depression in the first place. Spending signed by BOTH political parties led to the current economic implosion! When Bush was in power, the Democrats and Republicans approved low interest rates and uncontrolled spending. The same situation happened under President Clinton. Both, I repeat, both political parties signed legislation and approved funding! The standard of living has to drop for ALL Americans…this is why. We do not follow the Constitution, instead we follow a fiat money system that is backed by nothing. that leads to massive inflation. The fractional reserve requirement in commercial banks is now non-existant. Printing huge amounts of money leads to huge amounts of inflation. When we ship jobs, particularly high paying manufacturing jobs overseas that hurts the American economy. When illegal and legal immigrants take jobs from Americans, in the long term, it hurts our economy. Therefore hurting Americans. Socialism and wealth redistribution has never worked in any society in the history of the human race! When the government forces private lending institutions to give loans to people without following credit worthiness guidelines and artifically sets interest rates. The consumer credit housing market collapses as a result. When people are unemployed, taxes are raised in order to pay for increased welfare payments. More taxes equals less economic growth. ture. Taxing wealthy individuals will make them start business in more business friendly places. That means outside the USA. That leads to the entire cycle to continue to destroy itself. All government money, services, property, etc. is taken from the citizens in the form of taxes. There is no such thing as free, someone is paying for everything. So….. for those of you who voted for Clinton, Bush and especially Obama-heres’s to you suckers!! — Stop fighting the liberal/conservative blame game and instead READ THE CONSTITUTION, learn basic economic theories and read non-politically correct history. The resluts are shocking!

  12. Michael says:

    My fiance and I are about to buy a home. Our closing date is March 17 2009. We have both already recieved our tax returns. Does anyone know if we can do an amendment to our tax return and receive the cash this year, or will we have to wait till next years tax return, or my biggest fear that we will miss out completly because we have already filed this year. Any input would be appreciated. Thank you.

    • NedI says:

      Michael,

      You can certainly file Form 1040X anytime this year to get the First-time Homebuyer’s Credit.

  13. cathy says:

    wel here’s an update on my earlier post on the 7500.00 loan, the friend who bought her home in 2006 said that she doesnt have to pay it back because an agent at the IRS told her she didnt have to and that she was “safe from prosecution”. i figure why is everybody whining about whether they bought too early or too late, have to repay, dont have to repay , qualify or dont qualify. if you want the money just file it, thats exactly what she has done and is spending every penny of it knowing she didnt qualify.

    • FRED says:

      Yeah sure she did. I’de be willing to bet that your “friend” doesn’t exist and that you’re a pathological liar.

    • U R A LIAR says:

      What a bunch of BS, your friend is either fictionous or its you trying to make yourself feel better before prison.

  14. Rose says:

    I bought my house on February 8, 2009. I already took the old $7500 credit on my 2008 taxes.Here is my question – even though I bought my house in 2009 and filed the credit on my 2008 taxes. Am I eligible for $500 more bucks and do I not have to repay now since the new law went into effect? Could I amend my 2008 taxes?

  15. rOBERT says:

    That Is a bunch of BS. Home prices are down amd they get a break. What about the ones who have owned there homes and they just took a pay cut or got layed off and are at risk of losing there home, like me. Whet help Do we get?

    So people who hae monew to buy a home,we know who they are. Get $8000.00 and then just sell it. typical Gov.

    • jon says:

      You have to be a first time home buyer, AND you can’t sell for 3 years, AND it has to be your main residence.
      This is about getting the housing market back up and running, idiot.

      Its always “WHAT DO I GET?” typical morons.

      • rOBERT says:

        Three years is not very long and what if the house is foreclosed on the next year, Jackass.

        What kind of financial situation do you think people are in today. It’s more of a help those who don’t want to help themselves.
        Just want freebies from the government.
        It’s people like you that are most likely cause of the problems.

        I have never collected any government assistance ever in my life.
        Just sick and tired of paying for jackasses like you.

        Have a good day!

        • jon says:

          You’re the one who’s asking “What do I get?” Seems like you’re looking for some assistance….Jackass.
          If you’re laid off (not layed off) then you’re not paying for anybody.

          have a great day.

  16. Steve says:

    Can you use the $8000 tax credit if you have a conventional loan or FHA?

  17. jared says:

    Unfortunately, what everyone here is talking about, the corruption, the greed, the mistakes, is never, ever going to go away. Regardless of parties and candidates or rich and poor, this is our country and that’s how it works. Those who can take will take and those who have will always take more. The rich will always feel threatened and the poor will always feel disenfranchised. We all feel like we are entitled to what everyone else has but not the other way around. If one person gets $8,000 and another gets $8,001, you know someone will feel that’s its unfair but whats really unfair is that every single one of us over the age of 18 is to blame for this collapse and no one wants to admit fault. Only when people come to terms with the fact that our way of life is wrong will there ever be a chance for true and positive change. I’m certainly not suggesting socialism, but a society where people feel that we shouldn’t care for each other is just evil.

  18. Steve says:

    I thought this web site was to help answer questions, not bash people for the government trying to get the economy moving again. If you have never use the government for assistance good for you, but we all pay taxes. Get over it.

  19. Kathy says:

    If I lived in a financed mobile home in a trailer court and paid lot rent and in March 09 sold the m.h. and purchased a house do I qualify for the $8000 tax credit

  20. Jen says:

    The $8000 is real my husband and I have already received ours and spent it! We got our normal refund and on top of that an extra $8000 cash! Our home closed on Jan 2,2009 so we just made it!

  21. Jordan says:

    I’ve heard that you can get the $8000 to use as the down payment, but how would i go about getting before i purchase the house? that’s how i plan on getting the house

  22. bennie says:

    My husband and I did not filled our taxes jointly. Does this mean that we will not recieve 8000 but instead 4000?

  23. Lee says:

    If I get the 2% loan from BOFA fot a down payment,can I still get the 8000.00 dollars tax credit ?

  24. Oracle II says:

    I am a first time homebuyer. I moved into my home on July 27th 2007. Do I qualify for any of the tax credits? If so, which one? If not please explain why? Thanks.

  25. Brown says:

    What form do I use to file for 8,000 stilmus for purchase a home in 2009?

    • Ibot says:

      File 1040x & 5405. If you used TurboTax it’s easy to amend. It asks you all the right questions to set it up. I’ve amended using it before and it was great. Just got my paperwork ready to file when escrow closes in 2 weeks. Good luck!


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