When you hear the phrase ‘First-Time Home Buyer Credit’, you would naturally assume that such a credit would only apply to someone who had never purchased a home before. While that’s true, there is a loophole in the qualifications that allows people who do not currently own homes, but have in the past, to qualify for the credit. Also, if you own a vacation or rental property that is not your principal residence, you may also qualify for the credit. Here’s an excerpt from the official Q&A:
What is the definition of a first-time home buyer?
The law defines “first-time home buyer” as a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse.
For example, if you have not owned a home in the past three years but your spouse has owned a principal residence, neither you nor your spouse qualifies for the first-time home buyer tax credit. However, unmarried joint purchasers may allocate the credit amount to any buyer who qualifies as a first-time buyer, such as may occur if a parent jointly purchases a home with a son or daughter. Ownership of a vacation home or rental property not used as a principal residence does not disqualify a buyer as a first-time home buyer.
“First-time home buyer” thus includes the following classes:
• People who did not own a principal residence within the last three years, but may have owned one before.
• Unmarried joint purchasers, one of whom has owned a residence within the last three years and one of whom has not. This also includes parents co-purchasing with their children.
• People who own vacation homes that are not their principal residence.
• People who own rental property that is not their principal residence.
If you believe that you qualify as a “first-time home buyer”, then you may be eligible to claim the $8000 tax credit that is available on home purchases through December 1, 2009. If you would like to work with a Coldwell Banker realtor to look for a home, please call us today at 1-888-641-3107. This great opportunity will be ending soon, so please call today!
