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All About the First Time Home Buyer's Tax Credit
Friday, May 18, 2012
If you purchased a home in 2008, 2009, or 2010, and it is the first home you have owned to use as your primary residence, then it might be possible for you to take the first-time home-buyer credit. If you qualify for the first-time home-buyer credit then it might reduce your tax bill or increase your tax refund.
If you received the tax credit and then sold your home you have responsibilities for up to 15 years. You might need to repay the full amount of the credit you received. You will have certain forms you need to complete and submit with your taxes. If you purchased your home during the three years, 2008 to 2010 and your home is destroyed or condemned you will also have tax obligations you will be responsible for. There are also stipulations if you convert your home to a business or rental property.
The first-time home-buyer credit is not available in 2011, for the first time home-buyer. However, if you are in a certain group of the armed services, foreign service, or are employed by some areas of the intelligence community then it is possible for you to claim credit if you purchased your home last year. As with any of the other categories, if you qualify for credit in one of these categories then it is imperative you complete and file the proper paperwork. Also, some people ask the question, "What happens, if I sell my house
?" The answer is, if you purchased the home as a first time home-buyer, then you have certain responsibilities you must meet. You will be required to submit certain documentations, and, most likely, you will need to repay any credits you might have received.
Sometimes your home may not be your main residence. It is important to know when and how this condition might affect you. For example, if you sell your home or if you transfer the home to a former partner in a divorce arrangement then it is no longer your main residence. It will not be considered your main residence if you do not live in it for the majority of nights in a year. Then, of course, there are other reasons, more personal, such as if you die, your house is condemned, or you lose your home during a foreclosure procedure.
This credit can be somewhat confusing so it is important to consult with a professional to discuss your personal issues. You should remember, however, that there are also responsibilities, if you used the credit when buying your first home, if you are wondering what to do, if you, sell my house