Check Whether You Qualify
First determine if one or both could qualify for the credit.
The credit is worth as much as $8,000. You can use some or all of the credit to reduce your federal income tax bill. If there’s a leftover credit amount after your tax bill has been reduced to zero, you can ask the IRS to send you a refund check for that amount or you can treat that amount as an estimated tax payment for 2011.
To qualify for the credit you generally must have closed on a home purchase by April 30, 2010. However, if the home was under contract on April 30, 2010, the closing deadline was extended to June 30, 2010. An even later deadline applies if: (1) the home was under contract on April 30, 2010 with a contracted closing date of no later than June 30, and (2) the home did not close by June 30. In this case, the deadline for closing was extended to September 30, 2010.
You must meet these conditions to qualify for the maximum $8,000 first-time homebuyer credit:
- You did not own a principal U.S. residence (your main home) during the three-year period that ended on the home purchase date.
- Your 2010 adjusted gross income was less than $125,000. (The credit is phased out as adjusted gross income rises to $145,000 (above that figure, you don’t qualify).)
- You are at least 18 years old and cannot be claimed as a dependent on someone else’s tax return.
- The home cost at least $80,000 but not more than $800,000.