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Expert Q&A Archive

02/05/2010
More questions about the first-time homebuyer credit.
I have a question on the first-time homebuyer credit. I was wondering if the credit that has been extended until April 30, 2010, is still based on your 2009 income. And what is the phase-out level?
Karen Bolaji Fisher:
expert info »
This website will answer your questions regarding the 1st time home buyer tax credit: http://www.federalhousingtaxcredit.com/faq1.php
Jody Rorick, CPA:
expert info »
What determines the phase-out and the limit is the date you made the purchase. If purchased before November 6, 2009, the phase-out begins at $75,000 for single and $150,000 for joint filers and stops at $95,000/$170,000. If purchased after November 6th, 2009, the phase-out begins at $125,000/$225,000 and stops at $145,000/$245,000.
Rosemary Ervin, CPA:
expert info »
The credit is reduced or eliminated for higher-income taxpayers. The credit is phased out based on your modified adjusted gross income (MAGI). Different income limits apply to purchases on or before Nov. 6, 2009, and those after that date.

For purchases on or before Nov. 6, 2009, for a married couple filing a joint return, the phase-out range is $150,000 to $170,000. For other taxpayers, the phase-out range is $75,000 to $95,000. This means that the full credit is available for married couples filing a joint return whose MAGI is $150,000 or less and for other taxpayers whose MAGI is $75,000 or less.

For purchases after Nov. 6, 2009, for a married couple filing a joint return, the phase-out range is $225,000 to $245,000. For other taxpayers, the phase-out range is $125,000 to $145,000. This means that the full credit is available for married couples filing a joint return whose MAGI is $225,000 or less and for other taxpayers whose MAGI is $125,000 or less.