$8,000 tax credit?

The $8,000 first-time buyer credit is set to expire on December 1st. There is some talk that it won’t be extended which makes it a great time to get moving.

Here are a few scenarios related to the $8000 credit…….

If parents coborrow with their child, but have owned a home in the last 3 years, can the buyer still claim the $8000 credit? Yes, but the parents may not claim any part of it.

If a wife owned a home before she was married and the husband did not, can he claim the first time buyer credit on a new purchase? No, the IRS states that the taxpayer and taxpayer’s spouse may not have had ownership interest in a principal residence within the prior three years from the date of purchase.

An unmarried couple buys a house. One owned a home that he sold recently. Can they claim the $8000 credit? The individual who did not own a home may claim the entire credit.

A woman has rented an apartment for several years, but still owns a property she has rented out for 3 + years. Can she claim the credit on a new purchase? Yes, if she will occupy the new home, she may claim the whole credit.

A few other reminders. There are income limits to the program and the credit must be repaid if the buyers fail to occupy the home for 36 months. There is no waiver for military personnel at this time.