Top 10 Facts about the 2010 Homebuyer Credit

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If you are in the market for a new home, you can still claim the Homebuyer Credit. Here are 10 important things to know:

  1. You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.
  2. If you enter into a binding contract by April 30, 2010, you must close on or before June 30, 2010.
  3. For qualifying purchases in 2010, you have the option of claiming the credit on either your 2009 or 2010 return.
  4. First-time buyers get an $8,000 credit.
  5. You can qualify for a credit if you’ve lived in the same principal residence for any five consecutive year period during the eight year period that ended on the date the new home is purchased and the settlement date is after November 6, 2009. The maximum credit for long time residents is $6,500. However, married individuals filing separately are limited to $3,250.
  6. There are income limits to getting the credit in 2010. The full credit is available to taxpayers with modified adjusted gross incomes up to $125,000, or $225,000 for joint filers. It phases out between $125,000 and $145,000 ($225,000 and $245,000 for joint filers).
  7. Use IRS Form 5405 to claim this credit.
  8. No credit is available if the purchase price of the home exceeds $800,000.
  9. The purchaser must be at least 18 years old on the date of the purchase. For a married couple, only one spouse must meet this age requirement.
  10. A dependent is not eligible to claim this credit.
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