Many families took advantage of the "First Time Home Buyer Credit" program. Under the original terms of the program, families were able to get the $7,500 tax credit. Many knew that it had to be paid back over 15 years. But why turn down an interest-free loan?
Under the revised new first time home buyer tax credit which was worth up to $8,000 it does not require repayment. With only two months left to file taxes, it is important to find out what's changed on the 2010 return. Plus, the IRS introduces a new amnesty program for people with overseas accounts.
Here is a tax tip for you --> If you claimed the first-time home-buyer credit for 2008, you need to make the first installment payment of 1/15th of the credit you received. Use Part IV of Form 5405. People who don’t normally need to file a tax return may forget to make this payment. Remind your family and friends who live on Social Security or tax-free interest they will need to file a return this year if they used the credit in 2008.
Another Tip ---> If you moved out of the home or sold it before living there for 36 months, you also have to pay back the credit.
Tip for Those in the Military ---> Members of the military may still qualify for the home-buyer credit if they buy homes before April 30, 2011, and finalize the purchase by June 30. See this IRS page for more on special rules for those in the military and certain other federal employees.
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