The FHA has issued formal guidelines allowing 1^st time home buyers to apply a federal tax credit of up to $8,000 toward the purchase/ down payment of a home with an FHA-backed mortgage.

The bad news, for those hoping that the initiative would allow homebuyers to buy a home with nothing down, is that the tax credit can’t be used to meet the FHA’s 3.5 percent minimum down-payment requirement.

$8,000 Home Buyer Tax Credit at a Glance

The information on this page pertains to the American Recovery and Reinvestment Act of 2009.

·   The tax credit is for first-time home buyers only. For the tax credit program, the IRS defines a first-time home buyer as someone who has not owned a principal residence during the three-year period prior to the purchase.

·   The tax credit does not have to be repaid.

·   Any type of property qualifies

·   The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000.

·   The credit is available for homes purchased on or after January 1, 2009 and before December 1, 2009.

·   It can be claimed on 2009 or amended 2008 returns

·   Single taxpayers with incomes up to $75,000 and married couples with incomes up to $150,000 qualify for the full tax credit.

For more info…..

http://www.federalhousingtaxcredit.com/2009/faq.php

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