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The United States Congress has put into place a 2009 housing tax credit that can reach up to $8000. The credit will be defined as 10% of the sale of the US Virgin Islands home or up to $8,000, whichever is less. Those eligible as First Time Homebuyers are people who have not bought a residence for themselves in the last three years. However, there is a time frame that will be part of the eligibility standards. You must have a signed contract in place by April 30, 2010 with closing date to be before June 30, 2010. Other eligibility requirements are; Income limits for sales occurring on or after January 1, 2009 and on or before November 6, 2009 are no more than $75,000 for single ($150,000 on a joint return). For sales occuring after November 6, 2009, the income limit for single taxpayers is $125,000; the limit is $225,000 for married taxpayers filing a joint return. Unlike the tax credit of July, 2008, you do not have to repay the credit. The 2009 credit is NOT a loan but a genuine tax break for the new homeowners of the US Virgin Islands. Another difference between the 2009 and the 2008 tax credit is under the new 2009 tax credit you are still eligible if you have purchased the home under the Virgin Islands Mortgage Revenue Bond Program (MRB). The Congress has made claiming the 2009 tax credit very simple. Fill out the IRS Form 5405 to determine how much you qualify for. Put the amount on Line 69 of your Income Tax Form 1040 and that´s it! No pre-approval is required and no other forms are needed. Understand that this tax credit for US Virgin Island first time homebuyers is for homes already purchased with the closing date already past. Home types include; houseboats, condominiums, townhomes, single family homes and mobile homes as long as it is your principal residence for the following three years. If the Virgin Islands home is sold before the three year limit the tax credit will be recaptured in the sale. The 2009 tax credit is also refundable! Say you only owe the IRS $1,000, and you qualified for the full $8,000 tax credit. You will then receive a check from the IRS for $7,000 which is minus the $1,000 you owed. Another Note; If you have built your own home within the stated time frame, instead of buying from a builder or a re-sale home, you are still eligible for the 2009 tax credit. However, the date you would use would be the first day you actually lived in the newly built home. I hope I have answered all your questions regarding the 2009 Housing Tax Credit. Remember, you only have until April 30, 2010. Take advantage of the $8000 tax break by contacting our US Virgin Islands office |
