First-Time Home Buyer Tax Credit Extended For Qualified Service Members


The expiration date of the $8,000 first-time home buyer is still available for "Qualified service member" until April 30, 2011. Members of the uniformed services, members of the Foreign Service and employees of the intelligence community are eligible for this special rule. It applies to any individual (and, if married, the individual’s spouse) who serves on qualified official extended duty service outside of the United States for at least 90 days during the period beginning after Dec. 31, 2008, and ending before May 1, 2010


# Qualified service member” means a member of the uniformed services of the U.S military, a member of the Foreign Service of the U.S., or an employee of the intelligence community.
# “Official extended duty” means any period of extended duty outside of the United States for at least 90 days during the period beginning after December 31, 2008 and ending before May 1, 2010.

For those who are qualified service members, you have an extra year to cash in on the credit. Your new deadline is April 30, 2011.

There has been another modification to the credit for members of the armed service that deals with the Tax Credit Recapture Rules. Currently, a buyer must repay the credit if they move out of their new home within three years. But you are exempt if the move is due to government ordered extended duty service.

Buyers must meet the other qualification for the credit, however, including the income limits. These limits are set at $125,000 for single taxpayers and $225,000 for married taxpayers filing joint returns.

You must be a first-time home buyer, which is defined as "a buyer who has not owned a principal residence during the three-year period prior to the purchase. For married taxpayers, the law tests the homeownership history of both the home buyer and his/her spouse."

To get the first-time home buyers credit, you will need to claim it on your federal income tax return. There is a specific form (IRS Form 5405) that helps you determine how much the credit will be. Consult a Real Estate Professional as well as a Tax Professional about the credit to ensure it is submitted correctly.

For those interested in the credit,  visit FederalHousingTaxCredit.com to find out more information.