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The IRS encouraged all eligible homebuyers to take advantage of the first-time homebuyer credit but at the same time cautioned taxpayers to avoid schemes that help ineligible people file false claims for the credit. Currently, the agency is investigating a number of cases of potential fraud and is using computer screening tools to identify questionable claims for the credit.
Only the purchase of a main home located in the United States qualifies. Vacation homes and rental properties are not eligible
Income Tax News
Because the credit is only in effect for a limited time, those considering buying a home must act soon to qualify for the credit. Under the Recovery Act, an eligible home purchase must be completed before Dec. 1, 2009. This means that the last day to close on a home is Nov. 30.
The credit is 10 percent of the purchase price of the home, with a maximum available credit of $8,000 for either a single taxpayer or a married couple filing jointly. The limit is $4,000 for a married person filing a separate return. In most cases, the full credit will be available for homes costing $80,000 or more.
The credit reduces the taxpayer’s tax bill or increases his or her refund, dollar for dollar. Unlike most tax credits, the first-time homebuyer credit is fully refundable. This means that the credit will be paid to eligible taxpayers, even if they owe no tax or the credit is more than the tax owed.
The standard milage rate for 2008 tax year is 50.5 cents a mile and for tax year 2009 the rate is 55 cents
The maximum amount of wages that are subject to Social Security tax has increased from $102,000 in 2008 to $106,800 in 2009.
With this tax Cut Businesses may receive a Bonus First Year Depreciation of 50% of the cost of New Assets purchased in 2008. Used Assets will not be eligible.
If you don’t receive your refund within 28 days from the original IRS mailing date shown on Where’s My Refund?, you can start a refund trace online
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