The youngest homeowner is four years of age on the books for the first-time homebuyer tax credit. Apparently the kid was renting his first three years and wisely decided to cash in on that tax credit before he had mastered the alphabet. There are hundreds of minor homeowners like him, who claimed the $8,000 on first time home purchases. With the extension of the program, however, the Treasury Department put the tax credit jar on a higher shelf.
The Treasury Department hosted millions of dollars in questionable claims, ranging from the four-year-old homeowner to the lack of documentation that would verify eligibility for the program. The first-time home buyer tax credit, originally scheduled to sunset at the end of November 2009, was extended to the end of June for the actual close of the transaction, and with that extension comes additional specifications.
The program is limited to primary residences, and those have to be purchased for less than $800,000—no million dollar homes for first time buyers! Also, the purchaser must be at least old enough to vote and able to provide a HUD-1 Settlement Statement.
Even with these higher requirements, the First-Time Homebuyer program has increased annual income limits ($125,000 for singles and $225,000 for married couples), and as long as the buyer uses that property as a primary residence for at least three years, the buyer gets to keep the money.
Real estate has a lot of deals right now, and continues to be a first-time buyers’ market with the extension of this tax credit.
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