The 2009 First Time Homebuyer Tax Credit was created to provide incentives for first-time home buyers. Originally a $7,500 non-refundable credit, it was expanded in 2009 to a maximum $8,000 refundable credit for homes purchased between January 1 and November 30, 2009. The repayment requirement for the 2008 credit was also eliminated. The changes aimed to make the credit more beneficial for home buyers and boost home purchases.

1. 2009 First Time Homebuyer Tax Credit
Fundamentals
Created 2/19/09
Information is accurate as of the date of publication and is subject to change without notice.

2. First Time Homebuyer Tax Credit
Overview
In 2008 Congress created a $7,500 First-Time Homebuyer Tax
Credit.
It went into effect for homes closed on or after April 8, 2008 and
was set to expire July 1, 2009.
The issue: It had to be repaid over 15 years. Buyers viewed it
as a debt and not a benefit.
Information is accurate as of the date of publication and is subject to change without notice.

3. First Time Homebuyer Tax Credit
What Is The Homebuyer Tax Credit?
■ The credit has been extended to those who closed on homes on or
after January 1, 2009 and on or before November 30, 2009. It is still
repayable for 2008 purchases.
■ The credit has been expanded to a maximum $8,000.
■ The repayment requirement was eliminated for 2009.
■ Only available for first-time homebuyers.
Information is accurate as of the date of publication and is subject to change without notice.

4. First Time Homebuyer Tax Credit
What Is The Homebuyer Tax Credit?, cont.
■ The new Credit is an $8,000 REFUNDABLE Tax Credit (or up to
10% of the purchase price).
– If the property is $75,000, the credit is only $7,500. (Assume a
property over $80,000 for the rest of the discussion).
■ Refundable means that if your total tax liability in the given year is
less than $8,000, the IRS will send a refund for the balance.
Information is accurate as of the date of publication and is subject to change without notice.

5. First Time Homebuyer Tax Credit
Criteria
■ First-Time homebuyers. Must not have had ownership interest
during the past three years.
■ For married joint filers, both must meet the FTHB test to take the
credit on a joint return.
■ Primary residence only.
■ For new construction, the “purchase date” is the date you occupy
the home. The move in date must be before December 1, 2009.
Information is accurate as of the date of publication and is subject to change without notice.

6. First Time Homebuyer Tax Credit
Income Limits
TYPE INCOME LIMIT PHASE OUT
START
Single Filers $95,000 $75,000
Married Filers $170,000 $150,000
For singles making over $75,000 and couples making over
$150,000, the credit is proportionately reduced as incomes
approach $95,000 and $170,000 respectively. If a couple makes
$165,000, the excess amount is used to create a fraction
15,000/20,000 (.75) times the credit amount. 75% or $6,000 of the
credit would be disallowed resulting in a $2,000 credit.
Information is accurate as of the date of publication and is subject to change without notice.

7. First Time Homebuyer Tax Credit
Provisions
■ Recapture – 3 year residency. If the home is sold prior to three years of
ownership, the tax credit must be repaid.
– Designed to prevent flipping homes to obtain the credit.
■ Purchasers who utilize state/local bond programs can now use the credit.
■ Purchasers who bought before January 1, 2009 are still subject to the terms
of the repayable credit.
■ The credit can be claimed on the 2008 Tax Return, an amended 2008 Tax
Return, or 2009 Tax Return.
Information is accurate as of the date of publication and is subject to change without notice.

8. First Time Homebuyer Tax Credit
Who Cannot Take The Credit
■ Your income exceeds the phase-out range. This means joint filers
with Modified Adjusted Gross Income (MAGI) of $170,000 and
above and other taxpayers with MAGI of $95,000 and above.
■ You buy your home from a close relative. This includes your
spouse, parent, grandparent, child or grandchild.
■ You stop using your home as your primary residence.
■ You sell your home before the end of three years.
■ You are a non-resident alien.
Information is accurate as of the date of publication and is subject to change without notice.

9. First Time Homebuyer Tax Credit
Call to Action
■ The new credit is greatly improved from the original credit. GET
THE WORD OUT !
■ The NAR estimates that hundreds of thousands of potential
buyers can take advantage of the credit. BE POSITIVE!
■ Leverage your Wells Fargo Home Mortgage HMC for marketing
flyers. (Mailings and Open Houses)
Note: Purchasers are advised to consult their tax advisor regarding
this tax credit. Do not provide tax advice to your clients.
Information is accurate as of the date of publication and is subject to change without notice.

10. First Time Homebuyer Tax Credit
Marketing – Delete This Slide Prior To Realtor Presentations
Tax Credit Consumer FAST Flyer (#104704)
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Tax Credit Trade FAST Flyer (#104705)
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JV Tax Credit Consumer FAST Flyer (#104706)
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JV Tax Credit Trade FAST Flyer (#104707)
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Information is accurate as of the date of publication and is subject to change without notice.