Home Owners Tax Credit

[kimber62372]

I would like a little clarity on this subject if anyone has an inkling of how this works....here is the scenario:

For new home owners:
House bought in Dec 2008, awarded $7500 tax credit that must be paid back starting 2010 tax year
($500 for 15 yrs)   

For new home owners & previously owned home owners:
House bought in 2009, awarded $8000 tax credit that DOES NOT have to be paid back.
Previously owned home owners buying a house in 2009 get a $6500 tax credit that ALSO does not have to be paid back!   

WTF!!! please shed some light on the situation if anyone has had run into the same incident as myself! Thanks! 

[kapeh12]

It's simply a result of the ever changing tax code.  Every year the tax code changes, there are different credits, different deductions allowed, etc.  They are published based off of various legislative actions that occur in that year and typically have a time limit.

Similar concept is for those that have to pay mortgage insurance premiums (MIP) - there was a rule put in a few years ago (early to mid 2000's) that allow MIP to be claimed as an itemized deduction (along with interest on the mortgage).  That particular rule is set to expire after this year's taxes unless Congress chooses to extend the deduction or make the deduction permanent.

This is why it's important if you are using tax software to update it to use the current year's rules as things like these change from year to year - either that or get a good tax accountant to help you navigate the rule book.

[Oryon20]

As mentioned in the first reply, tax codes change constantly.  We bought windows in 2007, and only qualified for a $500 credit.  Had we waited another two years, we could have gotten $1500 in credit.

Hybrid credits phase out after manufacturers sell a certain amount.  For instance, anyone who bought a Fusion Hybrid from Ford before April 1st last year got a $3400 tax credit. From April 1st through September 30th, they got $1700.  October 1st, 2009 through March 31st of this year qualified for $850.  Now, if you buy one, you get no credit.

Unfortunately, just how it goes when it comes to the IRS, government, and taxes... nothing really ever stays constant.

[kimber62372]

Thanks! I guess I'm just frustrated since I have to pay back the $7500 tax credit over the course of 15 yrs & my sister who got the $6500 does NOT! 
Don't get me wrong...I'm happy for her but to think if I waited only 1 more month to close I could have been in the clear! crap!! lol