The Meredith Mortgage Team

Erin & Kathleen

Your Partners In Success 

The Bay Area’s Premier Mortgage Team

We Are A Direct Lender (Bank) & A Mortgage Broker

 

Erin Direct: 925.918.0585

Kathleen Direct: 925.735.6621

meredithteam@rockcliff.com

kmeredith@cmgmortgage.com

emeredith@cmgmortgage.com

The IRS gets the final say when it comes to who gets to claim the homebuyer tax credit, who does not, and under what circumstances, but if it’s anything like the last extension, it will take them awhile to update their FAQ page.

 They have made a feeble attempt to update some of the FAQs posted on their website

” however, there are some little known “interpretations” that most loan officers, real estate agents and even tax advisors don’t know about.

1. When a FTHB buys a 2-4-family home, and occupies one of the units as their personal residence, they are

only allowed to claim 10% (or $8000 max) of the unit they OCCUPY–not the entire sales price. Example: If the

FTHB bought a duplex for $120,000 and the units are identical, the “cost basis” is $60,000 and the tax credit

they can claim would be $6,000.

2. Income limits are based on ADJUSTED GROSS INCOME

3. Income CAN Exceed $125,000 (single) and $225,000 (married) by up to $20,000 and FHTB & Long-term

Residences can still get a partial tax credit based upon a “MAGI formula” created by the IRS.

4. New Construction – the “date of purchase” is considered the “date” the FTHB OCCUPIES the property–not the

closing date or the start-or-construction date.

5. Homes sold on “Land Contract or Contract for Deed” to a FTHB can QUALIFY for a tax credit if they meet 7

tests listed on the FAQs.

6. Tax credit is not available for FTHB in US Territories–only the 50 states.