Question about the $8,000 tax credit

**frugal is fun** · 02-25-2010, 03:20 PM

Since it came up in another thread, how does the tax credit work? i don't mean who qualifies, I mean how does it work money wise?

When you file your taxes do you basically reduce your income by $8,000, so in the end pay less taxes, OR do you actually get a check for $8,000?

I "thought" it was the first, just reduce your income by $8,000.

Can someone please explain this?

**leighcat** · 02-25-2010, 03:35 PM

I think it is a case by case basis. I am going through a mortgage broker whom I met at a county homebuyer's workshop. The workshop is geared towards lower income first time home buyers. She is setting all this up for me.
I don't make much and I have 2 kids, one that I claim on the taxes. So, I always get a refund back.
The county is loaning me the $8000. towards my home. Then I will have to have my taxes re-modified since I was in contract before March and my taxes have been done. So, I will be getting a check for the $8000 from Uncle Sam. Then I will have to give the check back to the county since they are lending me the money. That is how it is working in my case.

**Kyn** · 02-25-2010, 03:51 PM

I just filed this myself. Its pretty much $8000 free money if you closed before November. Thats on top of your regular tax refund (say if I got $1000 refund, now I get $9000 refund). But if you owe on your taxes they just take it out of the $8000 so you don't have to pay anything.

**frugal is fun** · 02-25-2010, 04:11 PM

I had no idea you actually received $8,000. I thought you just deducted it off your income so you pay less taxes.

Wah! I want that!!!

**frugal is fun** · 02-25-2010, 04:30 PM

Now I just made myself mad!!

I went to the IRS web site to get the facts about qualifying. I already new this but now that I found out you actually get the cash I'm so p*ssed!!

I got divorced in June 08. My name came off the deed & mortgage in September 08. I purchased my home in July 09. I do not qualify for the new home owner tax credit because I owned a home within the last three years. I do not qualify for the "new" $6,500 tax credit becasue I purchased my home before Nov. 6, 2009!

ARRRRRRR!!!!!!! That is so not right! If they amended the law they should have amended it back to when it started, not in November!!!

**druthb00** · 02-25-2010, 06:34 PM

Someone correct me if I am wrong here, but I could have sworn I read somewhere that yes, you do get an $8,000 check THIS year, but then at some point (not sure which year it would start) you actually give the money back, over time, in federal income taxes.

????? Am I nuts? LOL

**craftypam** · 02-25-2010, 07:26 PM

I don't know all the details; but I know some because my ds is looking into buying a home now. You have to sign by April 30, 2010 unless they extend it. You do get a check; (when you file your 2010 taxes) but if you buy a home for $60,000 you only get $6000.

**sinopa27** · 02-25-2010, 11:33 PM

my friend who just bought a home said that he will get a $8000 check in 20 weeks. You have to wait for some reason. I didnt understand why though.

**DJ1972** · 02-26-2010, 01:16 AM

This site explains it. http://www.federalhousingtaxcredit.com/glance.php

**Kyn** · 02-26-2010, 09:12 AM

Originally Posted by sinopa27

my friend who just bought a home said that he will get a $8000 check in 20 weeks. You have to wait for some reason. I didnt understand why though.

You have to wait because of all those frauds out there trying to scam the $8000. They have to really look at the tax returns

**Greebo** · 02-26-2010, 10:59 AM

Originally Posted by Kyn

I just filed this myself. Its pretty much $8000 free money

Um, no.

It's $8,000 of taxpayer money. Someone's paying it - just not you.

**Palooka** · 02-26-2010, 11:15 AM

Originally Posted by Greebo

Um, no.

It's $8,000 of taxpayer money. Someone's paying it - just not you.

You mean we have to pay for all that stimulus?

**Greebo** · 02-26-2010, 11:17 AM

Originally Posted by Palooka

You mean we have to pay for all that stimulus?

Isn't it stimulating??

**Palooka** · 02-26-2010, 11:25 AM

Originally Posted by Greebo

Isn't it stimulating??

All through my bones.

**Jmarie** · 03-01-2010, 07:58 PM

Originally Posted by sinopa27

my friend who just bought a home said that he will get a $8000 check in 20 weeks. You have to wait for some reason. I didnt understand why though.

You have to wait because they need a copy of the HUD-1 forms to prove that you actually settled on the home as well check the final price of the home. We just closed this friday and filed our taxes today and are able to claim the tax credit on 2009 taxes.

As an option, if you dont want to wait for the check in the mail, you can do the following..file your taxes minus the credit and sometime before April 15, file an addendum to add it later.. and just wait for the 8K check.