First Time Home Buyer Tax Credit: Part 5 of 6
This post is a part of a series of posts that gives the details on the Federal Governments tax credit incentive to First Time Home Buyers. The six parts answer the following questions:
- Am I Eligible?
- How does it work?
- How big is the tax credit, as a single person?
- How big is the tax credit, as a married couple?
- What about repayment?
- Are there other conditions I should know about?
If your questions are not answered by these posts, feel free to contact me directly!
Question 5: What About Repayment?
The American Recovery and Reinvestment act of 2009 made a big change to the credit by removing the repayment provision for credits on homes purchased in 2009. Previously, the tax credit had a payback provision that made it similar to an interest free loan that would have been paid back in full over 15 years (repayment) or at the time of resale (recapture) unless the home was sold at a loss. While the repayment provision is completely gone from the updated credit, a more mild recapture provision remains. If you sell your home within 3 years of purchase, the entire amount of the credit is recaptured, that is, the government takes it back.
For more details, go to http://www.federalhousingtaxcredit.com/
