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Old 04-08-2009, 04:50 PM
 
1,615 posts, read 2,958,766 times
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It seems that many people are still confused about one of the key issues involving how much you will be refunded on the Tax Credit. Most are under the assumption that it is a straight $8000.00 for everyone if you purchase a home, However it is 10% of what the purchase price of a home is up to a MAX of $8,000.00.

Example: If your home was $400,000 you would receive $4,000

just a heads up since I see so many using the full $8,000 in their examples.
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Old 04-08-2009, 04:59 PM
Status: "Yes, Denver is my middle name." (set 29 days ago)
 
Location: Just south of Denver since 1989
10,419 posts, read 27,070,552 times
Reputation: 6499
Quote:
Originally Posted by LongIslandCitizen View Post
It seems that many people are still confused about one of the key issues involving how much you will be refunded on the Tax Credit. Most are under the assumption that it is a straight $8000.00 for everyone if you purchase a home, However it is 10% of what the purchase price of a home is up to a MAX of $8,000.00.

Example: If your home was $400,000 you would receive $4,000

just a heads up since I see so many using the full $8,000 in their examples.
I think all my calculators are broken. I do 200,000 x10% and get 20,000. I even did 80,000 and got 8000

Now I have to throw away all my computers, including my new tablet
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Old 04-08-2009, 05:02 PM
 
Location: Outside Portsmouth, NH
128 posts, read 387,601 times
Reputation: 59
Quote:
Originally Posted by LongIslandCitizen View Post
It seems that many people are still confused about one of the key issues involving how much you will be refunded on the Tax Credit. Most are under the assumption that it is a straight $8000.00 for everyone if you purchase a home, However it is 10% of what the purchase price of a home is up to a MAX of $8,000.00.

Example: If your home was $400,000 you would receive $4,000

just a heads up since I see so many using the full $8,000 in their examples.
You are incorrect. You need to reread Form 5405. You choose the smaller of 10% the purchase price OR $8,000. In your example a $400,000 home would receive $8,000 credit since it is smaller than 10% of $400,000. 10% of $400,000 is not $4,000 but $40,000.
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Old 04-08-2009, 05:07 PM
 
Location: Salem, OR
13,193 posts, read 29,403,952 times
Reputation: 10691
If you are buying a home in Detroit for $10K then you'd only get $1,000 tax credit, but most homes will qualify for the full amount. Are there really that many homes that sell for less than $80,000?

There have been a couple of people who have used 1% instead of 10% in their calculations on this forum.
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Old 04-08-2009, 08:05 PM
 
1,111 posts, read 3,979,682 times
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I was going to start a thread to ask, but saw this so will ask here...

Does anyone know if the tax credit is valid for purchases of Coops? Everything I've read says it is good for first-time home buyers, but since a Coop is not real property, just want to make sure that coop buyers will be eligible?
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Old 04-08-2009, 09:43 PM
 
1,615 posts, read 2,958,766 times
Reputation: 1098
Quote:
Originally Posted by 2bindenver View Post
I think all my calculators are broken. I do 200,000 x10% and get 20,000. I even did 80,000 and got 8000

Now I have to throw away all my computers, including my new tablet

Looks like you are correct. I heard an agent talking about it.
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Old 04-09-2009, 04:57 AM
 
Location: Outside Portsmouth, NH
128 posts, read 387,601 times
Reputation: 59
Quote:
Originally Posted by danameless View Post
I was going to start a thread to ask, but saw this so will ask here...

Does anyone know if the tax credit is valid for purchases of Coops? Everything I've read says it is good for first-time home buyers, but since a Coop is not real property, just want to make sure that coop buyers will be eligible?
It is!

http://www.irs.gov/pub/irs-pdf/f5405.pdf
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