Bremerton First Time Home Buyer $8,000 Tax Credit | Time is Running OUT

Are you thinking of buying a home in the Bremerton area of Kitsap County?  Are you a first time home buyer or do you qualify as one under the IRS guidelines?  If you are, you might want to start thinking about putting both feet into the Bremerton housing market.  If you listen to some of the local multiple association directors the bottom just might be here and we just might be on the up side.

It is still a buyers market in Bremerton with approximately 7.5 months of inventory but with the absortpion rate I use 5-6 months is a normal market we are getting to normal! I am a fan of the normal market.  Of course there are home in Bremerton (all addresses with the “city” listed as Bremerton) that are a seller’s market. There have been some “hot” properties out there this spring – some with multiple offers and bidding “wars”. Really! You don’t often hear of that in the mainstream media.

Take a look at this article. US News and World Report released this pass week about the Bremerton/Silverdale housing market.  US News and World Report names Bremerton/Silverdale number 1 in the top 10 housing markets for the next 10 years.

I have several first time home buyers at the moment and we have all been talking about the new First-Time Home buyer Credit.  This is the new 2009 First-Time Home buyer Credit.  The $8,000. tax credit that is a credit and NOT a loan.  This credit DOES NOT have to be paid back and as everything there are exceptions.  The exceptions are…

• Must use the home as a principle residence for at least three years or face recapture of the tax credit amount. Certain exceptions apply. Ask your tax adviser or read Form 5405

So back to the “Who is Eligible?”.  You can claim the tax credit if you are a first-time home buyer.  Have you ever purchased a home?  If the answer is YES you STILL MIGHT BE ELIGIBLE.   The first-time home buyer must be able to state you did not own any other home during the past 3 year period that would end on the date of your new purchase.  So see you may be a first-time home buyer even if you have owned a home.  It is home-buying “do-overs”!

1. You must have purchased your home after January 1, 2009 and before December 31, 2009 to claim the tax credit.
2. Sometimes it is easier to decide eligibility if you know who CANNOT clam the credit
3. Your modified adjusted gross income is over $95,000 or $170,000 if married filing a joint return.
4. You are a nonresident alien.
5. You acquired your home by gift or you inherited it.
6. You purchased your home from a person you are related to.

There are other exceptions but for your local Kitsap area they don’t mean much.  You can find them on Form 5405.

Looks like there will be lots of first-time home buyers out this spring which in turn will help move that “move-up” market in Kitsap County.  Of course you will want to verify all of this with a tax consultant or go to the IRS web site and look for IRS Form 5405.

I have some ideas about this credit for local buyers so if you are interested please send me an email for more discussion!

Several of my first time home buyers have asked me the question

If I buy my home now do I have to wait till I file my 2009 taxes or can I have it now?

So the question is, “Can I apply the tax credit against my 2008 tax return?”  “What if I have already filed my 2008 taxes?”

Doing some research I have found the answer is IRS Form 5405.  Check out Part I, section C.

You can choose to claim the credit on your 2008 Form 1040 for a main home purchased after December 31, 2008 and before December 1, 2009.  If you make this choice, check the box.

If you have already filed your 2008 taxes you would have to file an amended return. See the IRS web site and look for form 1040-X and form 843. If you don’t understand the directions then consult a tax attorney or your CPA.

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Check out my new blog that will only address the Washington State Tax Credit Advance Loan Program. www.TaxCreditAdvanceLoanProgram.com - be sure to bookmark it so that you can access it for more information as it becomes available with the rapid changing $8,000 First Time Home Buyer Tax Credit Program.