Who does and who does not qualify for the $8000 maximum tax credit for first-time homebuyers?

"First-time homebuyer"  Anyone who has not owned a home within the last 3 years. If they sold a home 3 years ago, the date on the HUD 1 is the determining factor.

For a married couple, if one person owned a home within the last 3 years and the other did not, they don’t qualify for the tax credit.

However, if an unmarried couple jointly buys a home, and one person owned a home (within 3 years) and the other did not, they can "designate" the tax credit to that person who will be able to claim it on their individual tax return.

A non-US citizen, who meets resident-alien status (defined by the IRS Publication 519) is also eligible as long as they meet the requirements above and income limits

Types of Homes ( Principal Residences Only)

Single family, town homes and condos, manufactures or mobile homes and others A newly constructed home purchased from a homebuilder, may qualify.

IIf the FTHB owns a vacation home or rental property, which was not used as a primary residence within the last 3 years, they may qualify but will have to be able to prove it!

Simply calculation here: 10% of the home’s purchase price or a maximum of $8000. A tax credit can be claimed regardless if they obtain a mortgage, a tax-revenue mortgage or the buyer paid cash when purchasing the home.

First-time homebuyers should seek advice from a tax expert.

Here is the "simple" explanation based on several scenarios but keep in mind that the magic income number is always based on Modified ADJUSTED GROSS INCOME (MAGI).

You will find that the MAGI income on the following lines of the 3 tax forms.

Single taxpayer: MAGI of $75,000 or less  |  Married taxpayer: MAGI of $150,000 or less

However, there is a provision for those single and married who EXCEED the income limits to claim a partial tax credit. A "tax credit formula" has been created to determine the dollar amount. For example, if a single tax payer’s MAGI is $82,000, they could get a partial tax credit of $5200.

For  complete details, seek Legal and Accounting advice!