We have received many inquiries regarding the specifics of the first time home buyer tax credit. The following information will give you a broad overview. If after reviewing this you have further questions, please consult  with your professional tax provider.

• The tax credit is for first-time home buyers only. A first time home buyer is defined as a buyer who has not owned a principal residence home in the past three years. If a couple is married and one of the spouses has owned a principal residence within the last three years, the couple is disqualified from the tax credit. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first time buyer. Ownership of a vacation or rental property not used as a principal residence does not disqualify a buyer as a first time home buyer.
• The tax credit pertains to the purchase of any kind of home, new or resale, that will be used as a principal residence, and has been purchased on or after January 1 2009 and before December 1, 2009 (the purchase date is the date when closing occurs and the title to the property transfers to the home owner).
• The tax credit does not need to be repaid. This is the most significant difference between this tax credit and the one Congress enacted in July 2008. Because it had to be repaid, the previous credit was in essence, an interest free loan. This tax incentive is a true tax credit. However, the home buyer must use the residence as a principal residence for at least 3 years or face recapture of the tax credit amount.
• The tax credit is equal to 10 percent of the homes purchase price up to a maximum of $8000.
• Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit. Individuals and couples whose income exceeds these limits may qualify for a partial tax credit.
• Claiming the tax credit is easy! Simply claim it on your federal income tax return and the money is refunded to you in your tax refund check.