First-time homeowners are often nervous about all the new reports they have to make during the tax season. Instead of worrying, lessen your worries because first-time homebuyers have plenty of tax breaks and exemptions to offer. Consider these options and see if any are in-line with your home and financial situation. So here is an easy guide on getting afirst time home buyer tax refund.
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Who qualifies as a first-time buyer for first-time home buyer tax credits?
The US Department of Housing and Urban Development. You have specific criteria that define what it means to be a first time home buyer:
He has not had a home in the past three years.
You have owned a home for the past three years, but your spouse has not, or vice versa.
And You are a single parent or displaced housewife who only had a home with a former spouse while married.
You had a primary residence, such as a manufactured home, that was not built on a permanent basis.
You are a homeowner who has not complied with building codes and cannot code the property for less than it would cost to build a home.
As you can see, there are many ways to qualify as a first time home buyer under HUD, even if you previously had a primary residence.
Where do you get first-time homebuyer credit?
Although the federal tax credit is no longer available, you are likely to receive tax credits as part of a first-time home buyer program offered by your state. And it gets even better. In addition to tax credits, these programs often offer interest-free loans and grant money to cover the down payment.
Here’s an example of a first-time homebuyer program in Texas: The Texas State Affordable Housing Corporation offers mortgage tax certificates that allow you to deduct a healthy portion of the mortgage interest you pay on your annual federal tax return. . If you qualify, you can combine that tax exemption with the down payment and final cost assistance.
State and local programs
While direct federal tax credit is no longer available, there are tax credit opportunities at the state and local levels. State housing finance agencies distribute tax credits through programs such as the Mortgage Tax Credit Certificate or the MCC program. The program has made home ownership more affordable for modest and first-time buyers by reducing the mortgage interest owed on their loans. To find out if your particular state has other first-time home buying programs, visit your state’s gov website.
Depending on your local county or municipality, there may be specific financial criteria that you must meet to be eligible. For example, Baltimore County, the Maryland Homeowners Tax Credit Program, has an annual family income limit of $ 60,000, and the assets of the recipients, excluding the property that contains the tax credits or some accounts of retirement can no longer be was $ 200,000.
Federal loan programs can be very helpful for first-time homebuyers, although the programs are not just for beginners. The US Department of Veterans Affairs. For example, the US guarantees low-payment, no down payment mortgage loans to qualified veterans. The United States Department of Agriculture guarantees loans to low and moderate-income buyers who buy a house in a rural area. And the Federal Housing Administration secures loans with low repayment requirements for qualified buyers with modest incomes.
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